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2012 Florida Statutes
Chapter 626
INSURANCE FIELD REPRESENTATIVES AND OPERATIONS
INSURANCE FIELD REPRESENTATIVES AND OPERATIONS
CHAPTER 626
INSURANCE FIELD REPRESENTATIVES AND OPERATIONS
PART I
INSURANCE REPRESENTATIVES: LICENSING PROCEDURES AND GENERAL REQUIREMENTS(ss. 626.011-626.711)
PART II
GENERAL LINES AGENTS(ss. 626.726-626.754)
PART III
LIFE INSURANCE AGENTS(ss. 626.776-626.798)
PART IV
HEALTH INSURANCE AGENTS(ss. 626.826-626.839)
PART V
TITLE INSURANCE AGENTS(ss. 626.841-626.8473)
PART VI
INSURANCE ADJUSTERS(ss. 626.851-626.8797)
PART VII
INSURANCE ADMINISTRATORS(ss. 626.88-626.8991)
PART VIII
UNAUTHORIZED INSURERS AND SURPLUS LINES(ss. 626.901-626.939)
PART IX
UNFAIR INSURANCE TRADE PRACTICES(ss. 626.951-626.99)
PART X
VIATICAL SETTLEMENTS(ss. 626.991-626.99295)
PART XI
STRUCTURED SETTLEMENTS(s. 626.99296)
PART I
INSURANCE REPRESENTATIVES: LICENSINGPROCEDURES AND GENERAL REQUIREMENTS
626.011 Short title.
626.015 Definitions.
626.016 Powers and duties of department, commission, and office.
626.022 Scope of part.
626.025 Consumer protections.
626.0428 Agency personnel powers, duties, and limitations.
626.112 License and appointment required; agents, customer representatives, adjusters, insurance agencies, service representatives, managing general agents.
626.141 Violation not to affect validity of insurance.
626.161 Licensing forms.
626.171 Application for license as an agent, customer representative, adjuster, service representative, managing general agent, or reinsurance intermediary.
626.172 Application for insurance agency license.
626.175 Temporary licensing.
626.181 Number of applications for licensure required.
626.191 Repeated applications.
626.201 Investigation.
626.202 Fingerprinting requirements.
626.207 Disqualification of applicants and licensees; penalties against licensees; rulemaking authority.
626.211 Approval, disapproval of application.
626.221 Examination requirement; exemptions.
626.231 Eligibility; application for examination.
626.241 Scope of examination.
626.2415 Annual report of results of life insurance examinations.
626.251 Time and place of examination; notice.
626.261 Conduct of examination.
626.266 Printing of examinations or related materials to preserve examination security.
626.271 Examination fee; determination, refund.
626.281 Reexamination.
626.2815 Continuing education requirements.
626.2816 Regulation of continuing education for licensees, course providers, instructors, school officials, and monitor groups.
626.2817 Regulation of course providers, instructors, school officials, and monitor groups involved in prelicensure education for insurance agents and other licensees.
626.291 Examination results; denial, issuance of license.
626.292 Transfer of license from another state.
626.301 Form and contents of licenses, in general.
626.311 Scope of license.
626.321 Limited licenses.
626.322 License, appointment; certain military installations.
626.331 Number of appointments permitted or required.
626.341 Additional appointments; general lines, life, and health agents.
626.342 Furnishing supplies to unlicensed agent prohibited; civil liability.
626.371 Payment of fees, taxes for appointment period without appointment.
626.381 Renewal, continuation, reinstatement, or termination of appointment.
626.382 Continuation, expiration of license; insurance agencies.
626.431 Effect of expiration of license and appointment.
626.441 License or appointment; transferability.
626.451 Appointment of agent or other representative.
626.461 Continuation of appointment of agent or other representative.
626.471 Termination of appointment.
626.511 Reasons for termination; confidential information.
626.521 Character, credit reports.
626.536 Reporting of administrative actions.
626.541 Firm, corporate, and business names; officers; associates; notice of changes.
626.551 Notice of change of address, name.
626.561 Reporting and accounting for funds.
626.571 Delinquent agencies; notice of trusteeship.
626.5715 Parity of regulation of insurance agents and agencies.
626.572 Rebating; when allowed.
626.581 Commissions contingent upon adjustment savings; prohibition.
626.591 Penalty for violation of s. 626.581.
626.593 Insurance agent; written contract for compensation.
626.601 Improper conduct; inquiry; fingerprinting.
626.602 Insurance agency names; disapproval.
626.611 Grounds for compulsory refusal, suspension, or revocation of agent’s, title agency’s, adjuster’s, customer representative’s, service representative’s, or managing general agent’s license or appointment.
626.6115 Grounds for compulsory refusal, suspension, or revocation of insurance agency license.
626.621 Grounds for discretionary refusal, suspension, or revocation of agent’s, adjuster’s, customer representative’s, service representative’s, or managing general agent’s license or appointment.
626.6215 Grounds for discretionary refusal, suspension, or revocation of insurance agency license.
626.631 Procedure for refusal, suspension, or revocation of license.
626.641 Duration of suspension or revocation.
626.651 Effect of suspension, revocation upon associated licenses and appointments and licensees and appointees.
626.6515 Effect of suspension or revocation upon associated agencies.
626.661 Surrender of license.
626.681 Administrative fine in lieu of or in addition to suspension, revocation, or refusal of license, appointment, or disapproval.
626.691 Probation.
626.692 Restitution.
626.711 Retaliatory provision, agents.
626.011 Short title.—This part may be referred to as the “Licensing Procedures Law.”
History.—s. 181, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 217, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.015 Definitions.—As used in this part:
(1) “Adjuster” means a public adjuster as defined in s. 626.854, a public adjuster apprentice as defined in s. 626.8541, or an all-lines adjuster as defined in s. 626.8548.
(2) “Agent” means a general lines agent, life agent, health agent, or title agent, or all such agents, as indicated by context. The term “agent” includes an insurance producer or producer, but does not include a customer representative, limited customer representative, or service representative.
(3) “Appointment” means the authority given by an insurer or employer to a licensee to transact insurance or adjust claims on behalf of an insurer or employer.
(4) “Customer representative” means an individual appointed by a general lines agent or agency to assist that agent or agency in transacting the business of insurance from the office of that agent or agency.
(5) “General lines agent” means an agent transacting any one or more of the following kinds of insurance:
(a) Property insurance.
(b) Casualty insurance, including commercial liability insurance underwritten by a risk retention group, a commercial self-insurance fund as defined in s. 624.462, or a workers’ compensation self-insurance fund established pursuant to s. 624.4621.
(c) Surety insurance.
(d) Health insurance, when transacted by an insurer also represented by the same agent as to property or casualty or surety insurance.
(e) Marine insurance.
(6) “Health agent” means an agent representing a health maintenance organization or, as to health insurance only, an insurer transacting health insurance.
(7) “Home state” means the District of Columbia and any state or territory of the United States in which an agent or adjuster maintains his or her principal place of residence or principal place of business and is licensed to act as an insurance agent or adjuster.
(8) “Insurance agency” means a business location at which an individual, firm, partnership, corporation, association, or other entity, other than an employee of the individual, firm, partnership, corporation, association, or other entity and other than an insurer as defined by s. 624.03 or an adjuster as defined by subsection (1), engages in any activity or employs individuals to engage in any activity which by law may be performed only by a licensed insurance agent.
(9) “License” means a document issued by the department or office authorizing a person to be appointed to transact insurance or adjust claims for the kind, line, or class of insurance identified in the document.
(10) “Life agent” means an individual representing an insurer as to life insurance and annuity contracts, or acting as a viatical settlement broker as defined in s. 626.9911, including agents appointed to transact life insurance, fixed-dollar annuity contracts, or variable contracts by the same insurer.
(11) “Limited customer representative” means a customer representative appointed by a general lines agent or agency to assist that agent or agency in transacting only the business of private passenger motor vehicle insurance from the office of that agent or agency. A limited customer representative is subject to the Florida Insurance Code in the same manner as a customer representative, unless otherwise specified.
(12) “Limited lines insurance” means those categories of business specified in ss. 626.321 and 635.011.
(13) “Line of authority” means a kind, line, or class of insurance an agent is authorized to transact.
(14)(a) “Managing general agent” means any person managing all or part of the insurance business of an insurer, including the management of a separate division, department, or underwriting office, and acting as an agent for that insurer, whether known as a managing general agent, manager, or other similar term, who, with or without authority, separately or together with affiliates, produces directly or indirectly, or underwrites an amount of gross direct written premium equal to or more than 5 percent of the policyholder surplus as reported in the last annual statement of the insurer in any single quarter or year and also does one or more of the following:
1. Adjusts or pays claims.
2. Negotiates reinsurance on behalf of the insurer.
(b) The following persons shall not be considered managing general agents:
1. An employee of the insurer.
2. A United States manager of the United States branch of an alien insurer.
3. An underwriting manager managing all the insurance operations of the insurer pursuant to a contract, who is under the common control of the insurer subject to regulation under ss. 628.801-628.803, and whose compensation is not based on the volume of premiums written.
4. Administrators as defined by s. 626.88.
5. The attorney in fact authorized by and acting for the subscribers of a reciprocal insurer under powers of attorney.
(15) “Personal lines agent” means a general lines agent who is limited to transacting business related to property and casualty insurance sold to individuals and families for noncommercial purposes.
(16) “Resident” means an individual whose home state is the State of Florida.
(17) “Service representative” means an individual employed by an insurer or managing general agent for the purpose of assisting a general lines agent in negotiating and effecting insurance contracts when accompanied by a licensed general lines agent. A service representative shall not be simultaneously licensed as a general lines agent in this state. This subsection does not apply to life insurance.
(18) “Uniform application” means the uniform application of the National Association of Insurance Commissioners for nonresident agent licensing, effective January 15, 2001, or subsequent versions adopted by rule by the department.
History.—s. 4, ch. 2002-206; s. 907, ch. 2003-261; s. 20, ch. 2003-267; s. 13, ch. 2003-281; s. 16, ch. 2004-374; s. 7, ch. 2005-237; s. 4, ch. 2005-257; s. 6, ch. 2008-220; s. 1, ch. 2012-209.
626.016 Powers and duties of department, commission, and office.—
(1) The powers and duties of the Chief Financial Officer and the department specified in this part apply only with respect to insurance agents, insurance agencies, managing general agents, insurance adjusters, reinsurance intermediaries, viatical settlement brokers, customer representatives, service representatives, and agencies.
(2) The powers and duties of the commission and office specified in this part apply only with respect to service companies, administrators, and viatical settlement providers and contracts.
(3) The department has jurisdiction to enforce provisions of parts VIII and IX of this chapter with respect to persons who engage in actions for which a license issued by the department is legally required. The office has jurisdiction to enforce provisions of parts VIII and IX of this chapter with respect to persons who engage in actions for which a license or certificate of authority issued by the office is legally required. For persons who violate a provision of this chapter for whom a license or certificate of authority issued by either the department or office is not required, either the department or office may take administrative action against such person as authorized by this chapter, pursuant to agreement between the office and department.
(4) Nothing in this section is intended to limit the authority of the department and the Division of Insurance Fraud, as specified in s. 626.989.
History.—s. 908, ch. 2003-261; s. 19, ch. 2004-390; s. 5, ch. 2005-257.
626.022 Scope of part.—
(1) This part applies as to insurance agents, service representatives, adjusters, and insurance agencies; as to any and all kinds of insurance; and as to stock insurers, mutual insurers, reciprocal insurers, and all other types of insurers, except that:
(a) It does not apply as to reinsurance, except that ss. 626.011-626.022, ss. 626.112-626.181, ss. 626.191-626.211, ss. 626.291-626.301, s. 626.331, ss. 626.342-626.521, ss. 626.541-626.591, and ss. 626.601-626.711 shall apply as to reinsurance intermediaries as defined in s. 626.7492.
(b) The applicability of this chapter as to fraternal benefit societies shall be as provided in chapter 632.
(c) It does not apply to a bail bond agent, as defined in s. 648.25, except as provided in chapter 648 or chapter 903.
(d) This part does not apply to a certified public accountant licensed under chapter 473 who is acting within the scope of the practice of public accounting, as defined in s. 473.302, provided that the activities of the certified public accountant are limited to advising a client of the necessity of obtaining insurance, the amount of insurance needed, or the line of coverage needed, and provided that the certified public accountant does not directly or indirectly receive or share in any commission or referral fee.
(2) For the purposes of this part, “insurance” also includes annuity contracts.
(3) Provisions of this part that apply to general lines agents and applicants also apply to personal lines agents and applicants, except where otherwise provided.
History.—s. 180, ch. 59-205; s. 1, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 144, 217, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 5, ch. 92-318; s. 204, ch. 97-102; s. 5, ch. 98-199; s. 164, ch. 99-251; s. 1, ch. 99-275; s. 77, ch. 2003-1; s. 21, ch. 2003-267; s. 14, ch. 2003-281; s. 17, ch. 2004-374; s. 137, ch. 2007-5.
626.025 Consumer protections.—To transact insurance, agents shall comply with consumer protection laws, including the following, as applicable:
(1) Continuing education requirements for resident and nonresident agents, as required in s. 626.2815.
(2) Fingerprinting requirements for resident and nonresident agents, as required under s. 626.171 or s. 626.202.
(3) Fingerprinting following a department investigation under s. 626.601.
(4) The submission of credit and character reports, as required by s. 626.171 or s. 626.521.
(5) Qualifications for licensure as an agent in s. 626.731, s. 626.741, s. 626.785, s. 626.792, s. 626.831, or s. 626.835.
(6) Examination requirements in s. 626.221, s. 626.741, s. 626.792, or s. 626.835.
(7) Required licensure or registration of insurance agencies under s. 626.112.
(8) Requirements for licensure of resident and nonresident agents in s. 626.112, s. 626.321, s. 626.731, s. 626.741, s. 626.785, s. 626.792, s. 626.831, s. 626.835, or s. 626.927.
(9) The prohibition against employees of the United States Department of Veterans Affairs being licensed as life agents or health agents, under s. 626.788 or s. 626.833.
(10) The prohibition against licensed life agents or health agents who are members of the United States Armed Services selling insurance products to those of a lower military rank, under s. 626.789 or s. 626.834.
(11) Countersignature of insurance policies, as required under s. 624.425, s. 624.426, or s. 626.741.
(12) The code of ethics for life insurance agents, as set forth in s. 626.797.
(13) The prohibition against the designation of a life insurance agent or his or her family member as the beneficiary of a life insurance policy sold to an individual other than a family member under s. 626.798.
(14) Any other licensing requirement, restriction, or prohibition designated a consumer protection by the Chief Financial Officer, but not inconsistent with the requirements of Subtitle C of the Gramm-Leach-Bliley Act, 15 U.S.C.A. ss. 6751 et seq.
History.—s. 5, ch. 2002-206; s. 909, ch. 2003-261; s. 4, ch. 2004-374; s. 6, ch. 2005-257; s. 45, ch. 2010-175.
626.0428 Agency personnel powers, duties, and limitations.—
(1) An individual employed by an agent or agency on salary who devotes full time to clerical work, with incidental taking of insurance applications or quoting or receiving premiums on incoming inquiries in the office of the agent or agency, is not deemed to be an agent or customer representative if his or her compensation does not include in whole or in part any commissions on such business and is not related to the production of applications, insurance, or premiums.
(2) An employee of an agent or agency may not bind insurance coverage unless licensed and appointed as an agent or customer representative.
(3) An employee of an agent or agency may not initiate contact with any person for the purpose of soliciting insurance unless licensed and appointed as an agent or customer representative. As to title insurance, an employee of an agent or agency may not initiate contact with any individual proposed insured for the purpose of soliciting title insurance unless licensed as a title insurance agent or exempt from such licensure pursuant to s. 626.8417(4).
History.—ss. 2, 207, ch. 90-363; s. 4, ch. 91-429; s. 206, ch. 97-102; s. 47, ch. 2002-206; s. 2, ch. 2012-209.
626.112 License and appointment required; agents, customer representatives, adjusters, insurance agencies, service representatives, managing general agents.—
(1)(a) No person may be, act as, or advertise or hold himself or herself out to be an insurance agent, insurance adjuster, or customer representative unless he or she is currently licensed by the department and appointed by an appropriate appointing entity or person.
(b) Except as provided in subsection (6) or in applicable department rules, and in addition to other conduct described in this chapter with respect to particular types of agents, a license as an insurance agent, service representative, customer representative, or limited customer representative is required in order to engage in the solicitation of insurance. For purposes of this requirement, as applicable to any of the license types described in this section, the solicitation of insurance is the attempt to persuade any person to purchase an insurance product by:
1. Describing the benefits or terms of insurance coverage, including premiums or rates of return;
2. Distributing an invitation to contract to prospective purchasers;
3. Making general or specific recommendations as to insurance products;
4. Completing orders or applications for insurance products;
5. Comparing insurance products, advising as to insurance matters, or interpreting policies or coverages; or
6. Offering or attempting to negotiate on behalf of another person a viatical settlement contract as defined in s. 626.9911.
However, an employee leasing company licensed pursuant to chapter 468 which is seeking to enter into a contract with an employer that identifies products and services offered to employees may deliver proposals for the purchase of employee leasing services to prospective clients of the employee leasing company setting forth the terms and conditions of doing business; classify employees as permitted by s. 468.529; collect information from prospective clients and other sources as necessary to perform due diligence on the prospective client and to prepare a proposal for services; provide and receive enrollment forms, plans, and other documents; and discuss or explain in general terms the conditions, limitations, options, or exclusions of insurance benefit plans available to the client or employees of the employee leasing company were the client to contract with the employee leasing company. Any advertising materials or other documents describing specific insurance coverages must identify and be from a licensed insurer or its licensed agent or a licensed and appointed agent employed by the employee leasing company. The employee leasing company may not advise or inform the prospective business client or individual employees of specific coverage provisions, exclusions, or limitations of particular plans. As to clients for which the employee leasing company is providing services pursuant to s. 468.525(4), the employee leasing company may engage in activities permitted by ss. 626.7315, 626.7845, and 626.8305, subject to the restrictions specified in those sections. If a prospective client requests more specific information concerning the insurance provided by the employee leasing company, the employee leasing company must refer the prospective business client to the insurer or its licensed agent or to a licensed and appointed agent employed by the employee leasing company.
(2) No agent or customer representative shall solicit or otherwise transact as agent or customer representative, or represent or hold himself or herself out to be an agent or customer representative as to, any kind or kinds of insurance as to which he or she is not then licensed and appointed.
(3) No person shall act as an adjuster as to any class of business for which he or she is not then licensed and appointed.
(4) No person shall be, act as, or represent or hold himself or herself out to be a service representative unless he or she then holds a currently effective service representative license and appointment. This subsection does not apply as to similar representatives or employees of casualty insurers whose duties are restricted to health insurance.
(5) No person shall be, act as, or represent or hold himself or herself out to be a managing general agent unless he or she then holds a currently effective managing general agent license and appointment.
(6) An individual employed by a life or health insurer as an officer or other salaried representative may solicit and effect contracts of life insurance or annuities or of health insurance, without being licensed as an agent, when and only when he or she is accompanied by and solicits for and on the behalf of a licensed and appointed agent.
(7)(a) Effective October 1, 2006, no individual, firm, partnership, corporation, association, or any other entity shall act in its own name or under a trade name, directly or indirectly, as an insurance agency, unless it complies with s. 626.172 with respect to possessing an insurance agency license for each place of business at which it engages in any activity which may be performed only by a licensed insurance agent. Each agency engaged in business in this state before January 1, 2003, which is wholly owned by insurance agents currently licensed and appointed under this chapter, each incorporated agency whose voting shares are traded on a securities exchange, each agency designated and subject to supervision and inspection as a branch office under the rules of the National Association of Securities Dealers, and each agency whose primary function is offering insurance as a service or member benefit to members of a nonprofit corporation may file an application for registration in lieu of licensure in accordance with s. 626.172(3). Each agency engaged in business before October 1, 2006, shall file an application for licensure or registration on or before October 1, 2006.
1. If an agency is required to be licensed but fails to file an application for licensure in accordance with this section, the department shall impose on the agency an administrative penalty in an amount of up to $10,000.
2. If an agency is eligible for registration but fails to file an application for registration or an application for licensure in accordance with this section, the department shall impose on the agency an administrative penalty in an amount of up to $5,000.
(b) A registered insurance agency shall, as a condition precedent to continuing business, obtain an insurance agency license if the department finds that, with respect to any majority owner, partner, manager, director, officer, or other person who manages or controls the agency, any person has:
1. Been found guilty of, or has pleaded guilty or nolo contendere to, a felony in this state or any other state relating to the business of insurance or to an insurance agency, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of the cases.
2. Employed any individual in a managerial capacity or in a capacity dealing with the public who is under an order of revocation or suspension issued by the department. An insurance agency may request, on forms prescribed by the department, verification of any person’s license status. If a request is mailed within 5 working days after an employee is hired, and the employee’s license is currently suspended or revoked, the agency shall not be required to obtain a license, if the unlicensed person’s employment is immediately terminated.
3. Operated the agency or permitted the agency to be operated in violation of s. 626.747.
4. With such frequency as to have made the operation of the agency hazardous to the insurance-buying public or other persons:
a. Solicited or handled controlled business. This subparagraph shall not prohibit the licensing of any lending or financing institution or creditor, with respect to insurance only, under credit life or disability insurance policies of borrowers from the institutions, which policies are subject to part IX of chapter 627.
b. Misappropriated, converted, or unlawfully withheld moneys belonging to insurers, insureds, beneficiaries, or others and received in the conduct of business under the license.
c. Unlawfully rebated, attempted to unlawfully rebate, or unlawfully divided or offered to divide commissions with another.
d. Misrepresented any insurance policy or annuity contract, or used deception with regard to any policy or contract, done either in person or by any form of dissemination of information or advertising.
e. Violated any provision of this code or any other law applicable to the business of insurance in the course of dealing under the license.
f. Violated any lawful order or rule of the department.
g. Failed or refused, upon demand, to pay over to any insurer he or she represents or has represented any money coming into his or her hands belonging to the insurer.
h. Violated the provision against twisting as defined in s. 626.9541(1)(l).
i. In the conduct of business, engaged in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part IX of this chapter.
j. Willfully overinsured any property insurance risk.
k. Engaged in fraudulent or dishonest practices in the conduct of business arising out of activities related to insurance or the insurance agency.
l. Demonstrated lack of fitness or trustworthiness to engage in the business of insurance arising out of activities related to insurance or the insurance agency.
m. Authorized or knowingly allowed individuals to transact insurance who were not then licensed as required by this code.
5. Knowingly employed any person who within the preceding 3 years has had his or her relationship with an agency terminated in accordance with paragraph (d).
6. Willfully circumvented the requirements or prohibitions of this code.
(8) No insurance agent, insurance agency, or other person licensed under the Insurance Code may pay any fee or other consideration to an unlicensed person other than an insurance agency for the referral of prospective purchasers to an insurance agent which is in any way dependent upon whether the referral results in the purchase of an insurance product.
(9) Any person who knowingly transacts insurance or otherwise engages in insurance activities in this state without a license in violation of this section commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
History.—s. 190, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 154, 217, 807, 810, ch. 82-243; s. 16, ch. 87-226; s. 56, ch. 89-360; ss. 13, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 211, ch. 97-102; s. 8, ch. 98-199; s. 45, ch. 2001-63; s. 3, ch. 2001-142; ss. 8, 48, ch. 2002-206; s. 78, ch. 2003-1; s. 910, ch. 2003-261; s. 22, ch. 2003-267; s. 15, ch. 2003-281; s. 20, ch. 2004-390; s. 117, ch. 2005-2; s. 8, ch. 2005-237; s. 7, ch. 2005-257; s. 8, ch. 2006-305; s. 1, ch. 2007-199.
626.141 Violation not to affect validity of insurance.—An insurance contract which is otherwise valid and binding as between the parties thereto shall not be rendered invalid by reason of having been solicited, handled, or procured by or through an unlicensed agent or customer representative or an agent or customer representative who has not been appointed.
History.—s. 193, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 157, 217, 807, 810, ch. 82-243; ss. 14, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 9, ch. 98-199; s. 49, ch. 2002-206.
626.161 Licensing forms.—The department shall prescribe and furnish all printed forms required in connection with the application for issuance of and termination of all licenses and appointments.
History.—s. 195, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 159, 217, 807, 810, ch. 82-243; ss. 15, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 911, ch. 2003-261; s. 21, ch. 2004-390.
626.171 Application for license as an agent, customer representative, adjuster, service representative, managing general agent, or reinsurance intermediary.—
(1) The department may not issue a license as agent, customer representative, adjuster, service representative, managing general agent, or reinsurance intermediary to any person except upon written application filed with the department, meeting the qualifications for the license applied for as determined by the department, and payment in advance of all applicable fees. The application must be made under the oath of the applicant and be signed by the applicant. An applicant may permit a third party to complete, submit, and sign an application on the applicant’s behalf, but is responsible for ensuring that the information on the application is true and correct and is accountable for any misstatements or misrepresentations. The department shall accept the uniform application for nonresident agent licensing. The department may adopt revised versions of the uniform application by rule.
(2) In the application, the applicant shall set forth:
1(a) His or her full name, age, social security number, residence address, business address, mailing address, contact telephone numbers, including a business telephone number, and e-mail address.
(b) A statement indicating the method the applicant used or is using to meet any required prelicensing education, knowledge, experience, or instructional requirements for the type of license applied for.
(c) Whether he or she has been refused or has voluntarily surrendered or has had suspended or revoked a license to solicit insurance by the department or by the supervising officials of any state.
(d) Whether any insurer or any managing general agent claims the applicant is indebted under any agency contract or otherwise and, if so, the name of the claimant, the nature of the claim, and the applicant’s defense thereto, if any.
(e) Proof that the applicant meets the requirements for the type of license for which he or she is applying.
(f) The applicant’s gender (male or female).
(g) The applicant’s native language.
(h) The highest level of education achieved by the applicant.
(i) The applicant’s race or ethnicity (African American, white, American Indian, Asian, Hispanic, or other).
(j) Such other or additional information as the department may deem proper to enable it to determine the character, experience, ability, and other qualifications of the applicant to hold himself or herself out to the public as an insurance representative.
However, the application must contain a statement that an applicant is not required to disclose his or her race or ethnicity, gender, or native language, that he or she will not be penalized for not doing so, and that the department will use this information exclusively for research and statistical purposes and to improve the quality and fairness of the examinations.
(3) Each application shall be accompanied by payment of any applicable fee.
(4) An applicant for a license as an agent, customer representative, adjuster, service representative, managing general agent, or reinsurance intermediary must submit a set of the individual applicant’s fingerprints, or, if the applicant is not an individual, a set of the fingerprints of the sole proprietor, majority owner, partners, officers, and directors, to the department and must pay the fingerprint processing fee set forth in s. 624.501. Fingerprints shall be used to investigate the applicant’s qualifications pursuant to s. 626.201. The fingerprints shall be taken by a law enforcement agency, designated examination center, or other department-approved entity. The department shall require all designated examination centers to have fingerprinting equipment and to take fingerprints from any applicant or prospective applicant who pays the applicable fee. The department may not approve an application for licensure as an agent, customer service representative, adjuster, service representative, managing general agent, or reinsurance intermediary if fingerprints have not been submitted.
(5) The application for license filing fee prescribed in s. 624.501 is not subject to refund.
(6) Pursuant to the federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996, each party is required to provide his or her social security number in accordance with this section. Disclosure of social security numbers obtained through this requirement shall be limited to the purpose of administration of the Title IV-D program for child support enforcement.
History.—s. 196, ch. 59-205; ss. 13, 35, ch. 69-106; s. 4, ch. 71-86; s. 1, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 158(2nd), 217, 807, 810, ch. 82-243; s. 3, ch. 85-208; ss. 16, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 42, ch. 92-146; s. 212, ch. 97-102; s. 66, ch. 97-170; s. 10, ch. 98-199; s. 4, ch. 2001-142; ss. 9, 50, ch. 2002-206; s. 912, ch. 2003-261; s. 23, ch. 2003-267; s. 16, ch. 2003-281; s. 22, ch. 2004-390; s. 8, ch. 2005-257; s. 1, ch. 2006-184; s. 138, ch. 2007-5; s. 2, ch. 2008-237; s. 3, ch. 2012-209.
1Note.—Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
626.172 Application for insurance agency license.—
(1) The department may issue a license as an insurance agency to any person only after such person files a written application with the department and qualifies for such license.
(2) An application for an insurance agency license shall be signed by the owner or owners of the agency. If the agency is incorporated, the application shall be signed by the president and secretary of the corporation. The application for an insurance agency license shall include:
(a) The name of each majority owner, partner, officer, and director of the insurance agency.
(b) The residence address of each person required to be listed in the application under paragraph (a).
(c) The name of the insurance agency and its principal business address.
(d) The location of each agency office and the name under which each agency office conducts or will conduct business.
(e) The name of each agent to be in full-time charge of an agency office and specification of which office.
(f) The fingerprints of each of the following:
1. A sole proprietor;
2. Each partner;
3. Each owner of an unincorporated agency;
4. Each owner who directs or participates in the management or control of an incorporated agency whose shares are not traded on a securities exchange;
5. The president, senior vice presidents, treasurer, secretary, and directors of the agency; and
6. Any other person who directs or participates in the management or control of the agency, whether through the ownership of voting securities, by contract, or otherwise.
Fingerprints must be taken by a law enforcement agency or other entity approved by the department and must be accompanied by the fingerprint processing fee specified in s. 624.501. Fingerprints shall be processed in accordance with s. 624.34. However, fingerprints need not be filed for any individual who is currently licensed and appointed under this chapter. This paragraph does not apply to corporations whose voting shares are traded on a securities exchange.
(g) Such additional information as the department requires by rule to ascertain the trustworthiness and competence of persons required to be listed on the application and to ascertain that such persons meet the requirements of this code. However, the department may not require that credit or character reports be submitted for persons required to be listed on the application.
(h) Beginning October 1, 2005, the department shall accept the uniform application for nonresident agency licensure. The department may adopt by rule revised versions of the uniform application.
(3) The department shall issue a registration as an insurance agency to any agency that files a written application with the department and qualifies for registration. The application for registration shall require the agency to provide the same information required for an agency licensed under subsection (2), the agent identification number for each owner who is a licensed agent, proof that the agency qualifies for registration as provided in s. 626.112(7), and any other additional information that the department determines is necessary in order to demonstrate that the agency qualifies for registration. The application must be signed by the owner or owners of the agency. If the agency is incorporated, the application must be signed by the president and the secretary of the corporation. An agent who owns the agency need not file fingerprints with the department if the agent obtained a license under this chapter and the license is currently valid.
(a) If an application for registration is denied, the agency must file an application for licensure no later than 30 days after the date of the denial of registration.
(b) A registered insurance agency must file an application for licensure no later than 30 days after the date that any person who is not a licensed and appointed agent in this state acquires any ownership interest in the agency. If an agency fails to file an application for licensure in compliance with this paragraph, the department shall impose an administrative penalty in an amount of up to $5,000 on the agency.
(c) Sections 626.6115 and 626.6215 do not apply to agencies registered under this subsection.
(4) The department shall issue a license or registration to each agency upon approval of the application, and each agency shall display the license or registration prominently in a manner that makes it clearly visible to any customer or potential customer who enters the agency.
History.—ss. 161, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 213, ch. 97-102; s. 9, ch. 2005-257.
626.175 Temporary licensing.—
(1) The department may issue a nonrenewable temporary license for a period not to exceed 6 months authorizing appointment of a general lines insurance agent or a life agent, or an industrial fire or burglary agent, subject to the conditions described in this section. The fees paid for a temporary license and appointment shall be as specified in s. 624.501. Fees paid shall not be refunded after a temporary license has been issued.
(a) An applicant for a temporary license must be:
1. A natural person at least 18 years of age.
2. A United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services.
(b)1. In the case of a general lines agent, the department may issue a temporary license to an employee, a family member, a business associate, or a personal representative of a licensed general lines agent for the purpose of continuing or winding up the business affairs of the agent or agency in the event the licensed agent has died or become unable to perform his or her duties because of military service or illness or other physical or mental disability, subject to the following conditions:
a. No other individual connected with the agent’s business may be licensed as a general lines agent.
b. The proposed temporary licensee shall be qualified for a regular general lines agent license under this code except as to residence, examination, education, or experience.
c. Application for the temporary license shall have been made by the applicant upon statements and affidavit filed with the department on forms prescribed and furnished by the department.
d. Under a temporary license and appointment, the licensee shall not represent any insurer not last represented by the agent being replaced and shall not be licensed or appointed as to any additional kind, line, or class of insurance other than those covered by the last existing agency appointments of the replaced agent. If an insurer withdraws from the agency during the temporary license period, the temporary licensee may be appointed by another similar insurer but only for the period remaining under the temporary license.
2. A regular general lines agent license may be issued to a temporary licensee upon meeting the qualifications for a general lines agent license under s. 626.731.
(c) In the case of a life agent, the department may issue a temporary license:
1. To the executor or administrator of the estate of a deceased individual licensed and appointed as a life agent at the time of death;
2. To a surviving next of kin of the deceased individual, if no administrator or executor has been appointed and qualified; however, any license and appointment under this subparagraph shall be canceled upon issuance of a license to an executor or administrator under subparagraph 1.; or
3. To an individual otherwise qualified to be licensed as an agent who has completed the educational or training requirements prescribed in s. 626.7851 and has successfully sat for the required examination prior to termination of such 6-month period. The department may issue this temporary license only in the case of a life agent to represent an insurer of the industrial or ordinary-combination class.
(d) In the case of a limited license authorizing appointment as an industrial fire or burglary agent, the department may issue a temporary license to an individual otherwise qualified to be licensed as an agent who has completed the educational or training requirements prescribed in s. 626.732 and has successfully sat for the required examination prior to termination of the 6-month period.
(2) If an absent or disabled agent being replaced under a temporary license returns or becomes able to resume the active conduct of the agency, or if the disposition of the affairs of the agency of a deceased or mentally incompetent agent is completed, or the temporary licensee has qualified for a regular license, before expiration otherwise of the temporary license, the temporary license shall terminate.
(3) If, during the 6-month temporary license and appointment period, the applicant passes the licensing examination, the temporary license shall terminate and a license shall be issued by the department after payment of a modification fee as prescribed in s. 624.501.
(4) An application for a temporary license shall be made by the applicant upon statements and affidavit filed with the department on forms prescribed and furnished by the department.
(5) Except as provided in this section, the holder of a temporary license shall be subject to the Florida Insurance Code to the same extent as regularly licensed and appointed agents.
(6) The department may limit the authority of any temporary licensee in any way deemed necessary to protect insureds and the public.
(7) The department may issue to an applicant only one temporary license for each kind, line, or class of insurance or a single temporary license covering multiple lines.
History.—s. 10, ch. 2002-206; s. 24, ch. 2003-267; s. 17, ch. 2003-281; s. 106, ch. 2004-5.
626.181 Number of applications for licensure required.—After a license as agent, customer representative, or adjuster has been issued to an individual, the same individual shall not be required to take another examination for a similar license, regardless, in the case of an agent, of the number of insurers to be represented by him or her as agent, unless:
(1) Specifically ordered by the department to complete a new application for license; or
(2) During any period of 48 months since the filing of the original license application, such individual was not appointed as an agent, customer representative, or adjuster, unless the failure to be so appointed was due to military service, in which event the period within which a new application is not required may, in the discretion of the department, be extended to 12 months following the date of discharge from military service if the military service does not exceed 3 years, but in no event to extend under this clause for a period of more than 6 years from the date of filing of the original application for license.
History.—s. 197, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 162, 217, 807, 810, ch. 82-243; s. 16, ch. 82-386; s. 4, ch. 85-208; ss. 17, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 214, ch. 97-102; s. 11, ch. 98-199; s. 5, ch. 2001-142; s. 913, ch. 2003-261; s. 23, ch. 2004-390.
626.191 Repeated applications.—The failure of an applicant to secure a license upon application does not preclude the applicant from applying again. However, the department may not consider or accept any further application by the same applicant for a similar license dated or filed within 30 days after the date the department denied the last application, except as provided under s. 626.281.
History.—s. 198, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 163, 217, 807, 810, ch. 82-243; ss. 18, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 215, ch. 97-102; s. 914, ch. 2003-261; s. 35, ch. 2004-297; s. 24, ch. 2004-390; s. 4, ch. 2012-209.
626.201 Investigation.—
(1) The department or office may propound any reasonable interrogatories in addition to those contained in the application, to any applicant for license or appointment, or on any renewal, reinstatement, or continuation thereof, relating to the applicant’s qualifications, residence, prospective place of business, and any other matter which, in the opinion of the department or office, is deemed necessary or advisable for the protection of the public and to ascertain the applicant’s qualifications.
(2) The department or office may, upon completion of the application, make such further investigation as it may deem advisable of the applicant’s character, experience, background, and fitness for the license or appointment. Such an inquiry or investigation shall be in addition to any examination required to be taken by the applicant as hereinafter in this chapter provided.
(3) An inquiry or investigation of the applicant’s qualifications, character, experience, background, and fitness must include submission of the applicant’s fingerprints to the Department of Law Enforcement and the Federal Bureau of Investigation and consideration of any state criminal records, federal criminal records, or local criminal records obtained from these agencies or from local law enforcement agencies.
History.—s. 199, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 164(1st), 217, 807, 810, ch. 82-243; ss. 19, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 216, ch. 97-102; s. 12, ch. 98-199; s. 915, ch. 2003-261; s. 26, ch. 2003-267; s. 19, ch. 2003-281; s. 36, ch. 2004-297.
626.202 Fingerprinting requirements.—If there is a change in ownership or control of any entity licensed under this chapter, or if a new partner, officer, or director is employed or appointed, a set of fingerprints of the new owner, partner, officer, or director must be filed with the department or office within 30 days after the change. The acquisition of 10 percent or more of the voting securities of a licensed entity is considered a change of ownership or control. The fingerprints must be taken by a law enforcement agency or other department-approved entity and be accompanied by the fingerprint processing fee in s. 624.501.
History.—s. 6, ch. 2001-142; s. 92, ch. 2002-1; s. 916, ch. 2003-261; s. 25, ch. 2003-267; s. 18, ch. 2003-281.
626.207 Disqualification of applicants and licensees; penalties against licensees; rulemaking authority.—
(1) For purposes of this section, the term “financial services business” means any financial activity regulated by the Department of Financial Services, the Office of Insurance Regulation, or the Office of Financial Regulation.
(2) For purposes of this section, the terms “felony of the first degree” and “capital felony” include all felonies designated as such by the Florida Statutes, as well as any felony so designated in the jurisdiction in which the plea is entered or judgment is rendered.
(3) An applicant who commits a felony of the first degree; a capital felony; a felony involving money laundering, fraud, or embezzlement; or a felony directly related to the financial services business is permanently barred from applying for a license under this part. This bar applies to convictions, guilty pleas, or nolo contendere pleas, regardless of adjudication, by any applicant, officer, director, majority owner, partner, manager, or other person who manages or controls any applicant.
(4) For all other crimes not included in subsection (3), the department shall adopt rules establishing the process and application of disqualifying periods that include:
(a) A 15-year disqualifying period for all felonies involving moral turpitude that are not specifically included in the permanent bar contained in subsection (3).
(b) A 7-year disqualifying period for all felonies to which neither the permanent bar in subsection (3) nor the 15-year disqualifying period in paragraph (a) applies.
(c) A 7-year disqualifying period for all misdemeanors directly related to the financial services business.
(5) The department shall adopt rules providing for additional disqualifying periods due to the commitment of multiple crimes and other factors reasonably related to the applicant’s criminal history. The rules shall provide for mitigating and aggravating factors. However, mitigation may not result in a period of disqualification of less than 7 years and may not mitigate the disqualifying periods in paragraphs (4)(b) and (c).
(6) For purposes of this section, the disqualifying periods begin upon the applicant’s final release from supervision or upon completion of the applicant’s criminal sentence, including payment of fines, restitution, and court costs for the crime for which the disqualifying period applies.
(7) After the disqualifying period has been met, the burden is on the applicant to demonstrate that the applicant has been rehabilitated, does not pose a risk to the insurance-buying public, is fit and trustworthy to engage in the business of insurance pursuant to s. 626.611(7), and is otherwise qualified for licensure.
(8) The department shall adopt rules establishing specific penalties against licensees in accordance with ss. 626.641 and 626.651 for violations of s. 626.611, s. 626.621, s. 626.8437, s. 626.844, s. 626.935, s. 634.181, s. 634.191, s. 634.320, s. 634.321, s. 634.422, s. 634.423, s. 642.041, or s. 642.043. The purpose of the revocation or suspension is to provide a sufficient penalty to deter future violations of the Florida Insurance Code. The imposition of a revocation or the length of suspension shall be based on the type of conduct and the probability that the propensity to commit further illegal conduct has been overcome at the time of eligibility for relicensure. The length of suspension may be adjusted based on aggravating or mitigating factors, established by rule and consistent with this purpose.
(9) Section 112.011 does not apply to any applicants for licensure under the Florida Insurance Code, including, but not limited to, agents, agencies, adjusters, adjusting firms, customer representatives, or managing general agents.
History.—s. 11, ch. 2002-206; s. 9, ch. 2005-237; s. 6, ch. 2011-174.
626.211 Approval, disapproval of application.—
(1) If upon the basis of a completed application for license and such further inquiry or investigation as the department may make concerning an applicant the department is satisfied that, subject to any examination required to be taken and passed by the applicant for a license, the applicant is qualified for the license applied for and that all pertinent fees have been paid, it shall approve the application.
(2) Upon approval of an applicant for license as agent, customer representative, or adjuster who is subject to written examination, the department shall notify the applicant when and where he or she may take the required examination unless the applicant has taken and passed the examination within the 1-year period prior to the date of filing the application.
(3) Upon approval of an applicant for license who is not subject to examination, the department shall promptly issue the license.
(4) If upon the basis of the completed application and such further inquiry or investigation the department deems the applicant to be lacking in any one or more of the required qualifications for the license applied for, the department shall disapprove the application and notify the applicant, stating the grounds of disapproval.
History.—s. 200, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 165(1st), 217, 807, 810, ch. 82-243; s. 63, ch. 89-360; ss. 20, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 217, ch. 97-102; s. 13, ch. 98-199; s. 917, ch. 2003-261; s. 25, ch. 2004-390; s. 2, ch. 2006-184.
626.221 Examination requirement; exemptions.—
(1) The department shall not issue any license as agent, customer representative, or adjuster to any individual who has not qualified for, taken, and passed to the satisfaction of the department a written examination of the scope prescribed in s. 626.241.
(2) However, an examination is not necessary for any of the following:
(a) An applicant for renewal of appointment as an agent, customer representative, or adjuster, unless the department determines that an examination is necessary to establish the competence or trustworthiness of the applicant.
(b) An applicant for a limited license as agent for travel insurance, motor vehicle rental insurance, credit insurance, in-transit and storage personal property insurance, or portable electronics insurance under s. 626.321.
(c) In the discretion of the department, an applicant for reinstatement of license or appointment as an agent, customer representative, or all-lines adjuster whose license has been suspended within the 4 years before the date of application or written request for reinstatement.
(d) An applicant who, within the 4 years before application for license and appointment as an agent, customer representative, or adjuster, was a full-time salaried employee of the department who had responsible insurance duties for at least 2 continuous years and who had been a licensee within the 4 years before employment by the department with the same class of license as that being applied for.
(e) An applicant who has been licensed as an all-lines adjuster and appointed as an independent adjuster or company employee adjuster if an application for licensure is filed with the department within 48 months following the date of cancellation or expiration of the prior appointment.
(f) An applicant for a temporary license, except as otherwise provided in this code.
(g) An applicant for a license as a life or health agent who has received the designation of chartered life underwriter (CLU) from the American College of Life Underwriters and has been engaged in the insurance business within the past 4 years, except that the applicant may be examined on pertinent provisions of this code.
(h) An applicant for license as a general lines agent, customer representative, or adjuster who has received the designation of chartered property and casualty underwriter (CPCU) from the American Institute for Property and Liability Underwriters and has been engaged in the insurance business within the past 4 years, except that the applicant may be examined on pertinent provisions of this code.
(i) An applicant for license as a customer representative who has earned the designation of Accredited Advisor in Insurance (AAI) from the Insurance Institute of America, the designation of Certified Insurance Counselor (CIC) from the Society of Certified Insurance Service Counselors, the designation of Accredited Customer Service Representative (ACSR) from the Independent Insurance Agents of America, the designation of Certified Professional Service Representative (CPSR) from the National Foundation for Certified Professional Service Representatives, the designation of Certified Insurance Service Representative (CISR) from the Society of Certified Insurance Service Representatives, or the designation of Certified Insurance Representative (CIR) from the National Association of Christian Catastrophe Insurance Adjusters. Also, an applicant for license as a customer representative who has earned an associate degree or bachelor’s degree from an accredited college or university and has completed at least 9 academic hours of property and casualty insurance curriculum, or the equivalent, or has earned the designation of Certified Customer Service Representative (CCSR) from the Florida Association of Insurance Agents, or the designation of Registered Customer Service Representative (RCSR) from a regionally accredited postsecondary institution in this state, or the designation of Professional Customer Service Representative (PCSR) from the Professional Career Institute, whose curriculum has been approved by the department and which includes comprehensive analysis of basic property and casualty lines of insurance and testing at least equal to that of standard department testing for the customer representative license. The department shall adopt rules establishing standards for the approval of curriculum.
(j) An applicant for license as a resident or nonresident all-lines adjuster who has the designation of Accredited Claims Adjuster (ACA) from a regionally accredited postsecondary institution in this state, Professional Claims Adjuster (PCA) from the Professional Career Institute, Professional Property Insurance Adjuster (PPIA) from the HurriClaim Training Academy, Certified Adjuster (CA) from ALL LINES Training, or Certified Claims Adjuster (CCA) from the Association of Property and Casualty Claims Professionals whose curriculum has been approved by the department and which includes comprehensive analysis of basic property and casualty lines of insurance and testing at least equal to that of standard department testing for the all-lines adjuster license. The department shall adopt rules establishing standards for the approval of curriculum.
(k) An applicant qualifying for a license transfer under s. 626.292 if the applicant:
1. Has successfully completed the prelicensing examination requirements in the applicant’s previous home state which are substantially equivalent to the examination requirements in this state, as determined by the department;
2. Has received the designation of chartered property and casualty underwriter (CPCU) from the American Institute for Property and Liability Underwriters and been engaged in the insurance business within the past 4 years if applying to transfer a general lines agent license; or
3. Has received the designation of chartered life underwriter (CLU) from the American College of Life Underwriters and been engaged in the insurance business within the past 4 years if applying to transfer a life or health agent license.
(l) An applicant for a license as a nonresident agent if the applicant:
1. Has successfully completed prelicensing examination requirements in the applicant’s home state which are substantially equivalent to the examination requirements in this state, as determined by the department, as a requirement for obtaining a resident license in his or her home state;
2. Held a general lines agent license, life agent license, or health agent license before a written examination was required;
3. Has received the designation of chartered property and casualty underwriter (CPCU) from the American Institute for Property and Liability Underwriters and has been engaged in the insurance business within the past 4 years, if an applicant for a nonresident license as a general lines agent; or
4. Has received the designation of chartered life underwriter (CLU) from the American College of Life Underwriters and been in the insurance business within the past 4 years, if an applicant for a nonresident license as a life agent or health agent.
(3) An individual who is already licensed as a customer representative shall not be licensed as a general lines agent without application and examination for such license.
History.—s. 201, ch. 59-205; s. 1, ch. 67-91; ss. 13, 35, ch. 69-106; s. 5, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 87, ch. 79-40; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 164(2nd), 217, 807, 810, ch. 82-243; s. 17, ch. 82-386; s. 86, ch. 83-216; s. 6, ch. 88-166; ss. 21, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 218, ch. 97-102; s. 14, ch. 98-199; s. 1, ch. 2001-190; s. 1, ch. 2002-84; ss. 12, 51, ch. 2002-206; s. 918, ch. 2003-261; s. 27, ch. 2003-267; s. 20, ch. 2003-281; s. 26, ch. 2004-390; s. 10, ch. 2005-257; s. 3, ch. 2006-184; s. 2(1st), ch. 2007-199; ss. 7, 25, ch. 2008-220; s. 44, ch. 2010-175; s. 5, ch. 2012-209.
626.231 Eligibility; application for examination.—
(1) No person shall be permitted to take an examination for license until his or her application for examination or application for the license has been approved and the required fees have been received by the department or a person designated by the department to administer the examination.
(2) A person required to take an examination for a license may take an examination before submitting an application for licensure pursuant to s. 626.171 by submitting an application for examination through the department’s Internet website or the website of a person designated by the department to administer the examination. The department may require the applicant to provide the following information as part of the application:
(a) His or her full name, date of birth, social security number, e-mail address, residence address, business address, and mailing address.
(b) The type of license which the applicant intends to apply for.
(c) The name of any required prelicensing course he or she has completed or is in the process of completing.
(d) The method by which the applicant intends to qualify for the type of license if other than by completing a prelicensing course.
(e) The applicant’s gender.
(f) The applicant’s native language.
(g) The highest level of education achieved by the applicant.
(h) The applicant’s race or ethnicity.
However, the application form must contain a statement that an applicant is not required to disclose his or her race or ethnicity, gender, or native language, that he or she will not be penalized for not doing so, and that the department will use this information exclusively for research and statistical purposes and to improve the quality and fairness of the examinations.
(3) Each application shall be accompanied by payment of the applicable examination fee.
History.—s. 202, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 165(2nd), 217, 807, 810, ch. 82-243; s. 5, ch. 85-208; s. 7, ch. 88-166; ss. 22, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 219, ch. 97-102; s. 919, ch. 2003-261; s. 27, ch. 2004-390; s. 4, ch. 2006-184; s. 6, ch. 2012-209.
626.241 Scope of examination.—
(1) Each examination for a license as agent, customer representative, or adjuster shall be of such scope as is deemed by the department to be reasonably necessary to test the applicant’s ability and competence and knowledge of the kinds of insurance and transactions to be handled under the license applied for, of the duties and responsibilities of such a licensee, and of the pertinent provisions of the laws of this state.
(2) Examinations given applicants for license as a general lines agent or customer representative shall cover all property, casualty, and surety insurances, except as provided in subsection (5) relative to limited licenses.
(3) Examinations given applicants for a life agent’s license shall cover life insurance and variable annuities.
(4) Examinations given applicants for a health agent’s license shall cover health insurance.
(5) Examinations given applicants for a limited license as agent or as customer representative shall be limited in scope to the kind of business to be transacted under such license.
(6) In order to reflect the differences between adjusting claims for an insurer and adjusting claims for an insured, the department shall create an examination for applicants seeking licensure as a public adjuster and a separate examination for applicants seeking licensure as an all-lines adjuster.
(a) Examinations for a license as an all-lines adjuster must cover adjusting in all lines of insurance, other than life and annuity.
(b) An examination for workers’ compensation insurance or health insurance is not required for public adjusters.
(7) Examinations given applicants for licensure as title agents must cover title insurance, abstracting, title searches, examination of title, closing procedures, and escrow handling.
(8) An examination for licensure as a personal lines agent shall consist of 100 questions and shall be limited in scope to the kinds of business transacted under such license.
(9) This section applies to any person who submits an application for license and to any person who submits an application for examination prior to filing an application for license.
History.—s. 203, ch. 59-205; s. 7, ch. 61-441; s. 1, ch. 65-16; ss. 13, 35, ch. 69-106; s. 2, ch. 73-31; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 88, ch. 79-40; ss. 1, 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 168, 217, 807, 810, ch. 82-243; ss. 23, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 7, ch. 92-318; s. 7, ch. 92-328; s. 920, ch. 2003-261; s. 18, ch. 2004-374; s. 28, ch. 2004-390; s. 5, ch. 2006-184; s. 8, ch. 2008-220; s. 7, ch. 2012-209.
626.2415 Annual report of results of life insurance examinations.—
(1) No later than May 1 of each year, the department or a person designated by the department shall prepare, publicly announce, and publish a report that summarizes statistical information relating to life insurance agent examinations administered during the preceding calendar year. Each report shall include the following information for all examinees combined and separately by race or ethnicity, gender, race or ethnicity within gender, education level, and native language:
(a) The total number of examinees.
(b) The percentage and number of examinees who passed the examination.
(c) The mean scaled scores on the examination.
(d) Standard deviation of scaled scores on the examination.
(2) No later than May 1 of each year, the department or a person designated by the department shall prepare and make available upon request a report of summary statistical information relating to each life insurance test form administered during the preceding calendar year. The report shall show, for each test form, for all examinees combined and separately for African-American examinees, white examinees, American Indian examinees, Asian examinees, Hispanic examinees, and other examinees, the correct-answer rates and correlations.
(3) The department may provide a testing service provider, under contract with the department, demographic information received by the department on applications relating to examinations taken to qualify for an insurance agent license if the department requires the provider to review and analyze examination results in conjunction with the race or ethnicity, gender, education level, and native language of examinees.
History.—s. 6, ch. 2006-184.
626.251 Time and place of examination; notice.—
(1) The department, or a person designated by the department, shall provide notice of the time and place of the examination to each applicant for examination and each applicant for license required to take an examination who will be eligible to take the examination as of the examination date. The notice shall be e-mailed to the applicant at the e-mail address shown on the application for license or examination. Notice is deemed given when so mailed.
(2) The examination shall be held in an adequate and designated examination center in this state.
(3) The department shall make an examination available to the applicant, to be taken as soon as reasonably possible after the applicant is eligible therefor. Any examination required under this part shall be available in this state at a designated examination center.
History.—s. 204, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 169, 217, 807, 810, ch. 82-243; s. 6, ch. 85-208; s. 8, ch. 88-166; ss. 24, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 220, ch. 97-102; s. 921, ch. 2003-261; s. 29, ch. 2004-390; s. 7, ch. 2006-184; s. 8, ch. 2012-209.
626.261 Conduct of examination.—
(1) The applicant for license or the applicant for examination shall appear in person and personally take the examination for license at the time and place specified by the department or by a person designated by the department.
(2) The examination shall be conducted by an employee of the department or a person designated by the department for that purpose.
(3) The questions propounded shall be as prepared by the department, or by a person designated by the department for that purpose, consistent with the applicable provisions of this code.
(4) All examinations shall be given and graded in a fair and impartial manner and without unfair discrimination in favor of or against any particular applicant.
(5) The department may provide licensure examinations in Spanish. Applicants requesting examination or reexamination in Spanish must bear the full cost of the department’s development, preparation, administration, grading, and evaluation of the Spanish-language examination. When determining whether it is in the public interest to allow the examination to be translated into and administered in Spanish, the department shall consider the percentage of the population who speak Spanish.
History.—s. 205, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 217, 807, 810, ch. 82-243; s. 7, ch. 85-208; ss. 25, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 922, ch. 2003-261; s. 30, ch. 2004-390; s. 8, ch. 2006-184; s. 6, ch. 2012-151.
626.266 Printing of examinations or related materials to preserve examination security.—A contract let for the development, administration, or grading of examinations or related materials by the department pursuant to the various agent, customer representative, or adjuster licensing and examination provisions of this code may include the printing or furnishing of these examinations or related materials in order to preserve security. Any such contract shall be let as a contract for a contractual service pursuant to s. 287.057.
History.—s. 1, ch. 85-208; s. 79, ch. 87-224; s. 5, ch. 88-32; s. 32, ch. 90-268; ss. 37, 44, ch. 90-335; s. 15, ch. 98-199; s. 79, ch. 2003-1; s. 923, ch. 2003-261; s. 31, ch. 2004-390.
Note.—Former s. 283.422.
626.271 Examination fee; determination, refund.—
(1) Prior to being permitted to take an examination, each applicant who is subject to examination shall pay to the department or a person designated by the department an examination fee. A separate and additional examination fee shall be payable for each separate class of license applied for, notwithstanding that all such examinations are taken on the same date and at the same place.
(2) The fee for examination shall not be subject to refund.
History.—s. 206, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 170, 217, 807, 810, ch. 82-243; s. 8, ch. 85-208; ss. 26, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 924, ch. 2003-261; s. 32, ch. 2004-390.
626.281 Reexamination.—
(1) An applicant for license or examination who has:
(a) Taken an examination and failed to make a passing grade, or
(b) Failed to appear for the examination or to take or complete the examination at the time and place specified in the notice of the department,
may take additional examinations, after filing with the department or its designee an application for reexamination together with applicable fees. The failure of an applicant to pass an examination, to appear for the examination, or to take or complete the examination does not preclude the applicant from taking subsequent examinations.
(2) Applicants may not take an examination for a license type more than five times in a 12-month period.
(3) The department may require an individual whose license as an agent, customer representative, or adjuster has expired or been suspended to pass an examination before reinstating or relicensing the individual as to any class of license. The examination fee must be paid for each examination.
History.—s. 207, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 171, 217, 807, 810, ch. 82-243; s. 9, ch. 88-166; ss. 27, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 9, ch. 92-146; s. 16, ch. 98-199; s. 925, ch. 2003-261; s. 33, ch. 2004-390; s. 9, ch. 2006-184; s. 9, ch. 2012-209.
626.2815 Continuing education requirements.—
(1) The purpose of this section is to establish requirements and standards for continuing education courses for individuals licensed to solicit, sell, or adjust insurance in the state.
(2) Except as otherwise provided in this section, this section applies to individuals licensed to engage in the sale of insurance or adjustment of insurance claims in this state for all lines of insurance for which an examination is required for licensing and to each insurer, employer, or appointing entity, including, but not limited to, those created or existing pursuant to s. 627.351. This section does not apply to an individual who holds a license for the sale of any line of insurance for which an examination is not required by the laws of this state or who holds a limited license as a crop or hail and multiple-peril crop insurance agent. Licensees who are unable to comply with the continuing education requirements due to active duty in the military may submit a written request for a waiver to the department.
1(3) Each licensee subject to this section must, except as set forth in paragraphs (b), (c), (d), and (f), complete a minimum of 24 hours of continuing education courses every 2 years in basic or higher-level courses prescribed by this section or in other courses approved by the department.
(a) Each licensee must complete 3 hours of continuing education, approved by the department, every 2 years on the subject matter of ethics. Each licensed general lines agent and customer representative must complete 1 hour of continuing education, approved by the department, every 2 years on the subject matter of premium discounts available on property insurance policies based on various hurricane mitigation options and the means for obtaining the discounts.
(b) A licensee who has been licensed for 6 or more years must complete 20 hours of continuing education every 2 years in intermediate or advanced-level courses prescribed by this section or in other courses approved by the department.
(c) A licensee who has been licensed for 25 years or more and is a CLU or a CPCU or has a Bachelor of Science degree in risk management or insurance with evidence of 18 or more semester hours in upper-level insurance-related courses must complete 10 hours of continuing education courses every 2 years in courses prescribed by this section or in other courses approved by the department.
(d) An individual who holds a license as a customer representative, limited customer representative, title agent, motor vehicle physical damage and mechanical breakdown insurance agent, or an industrial fire insurance or burglary insurance agent and who is not a licensed life or health agent, must complete 10 hours of continuing education courses every 2 years.
(e) An individual who holds a license to solicit or sell life or health insurance and a license to solicit or sell property, casualty, surety, or surplus lines insurance must complete courses in life or health insurance for one-half of the total hours required and courses in property, casualty, surety, or surplus lines insurance for one-half of the total hours required. However, a licensee who holds an industrial fire or burglary insurance license and who is a licensed life or health agent must complete 4 hours of continuing education courses every 2 years related to industrial fire or burglary insurance and the remaining number of hours of continuing education courses related to life or health insurance.
(f) An individual subject to chapter 648 must complete a minimum of 14 hours of continuing education courses every 2 years.
(g) Excess hours accumulated during any 2-year compliance period may be carried forward to the next compliance period.
(h) An individual teaching an approved course of instruction or lecturing at any approved seminar and attending the entire course or seminar qualifies for the same number of classroom hours as would be granted to a person taking and successfully completing such course or seminar. Credit is limited to the number of hours actually taught unless a person attends the entire course or seminar. An individual who is an official of or employed by a governmental entity in this state and serves as a professor, instructor, or 2in another position or office, the duties and responsibilities of which are determined by the department to require monitoring and review of insurance laws or insurance regulations and practices, is exempt from this section.
(4) Compliance with continuing education requirements is a condition precedent to the issuance, continuation, reinstatement, or renewal of any appointment subject to this section. However:
(a) An appointing entity, except one that appoints individuals who are employees or exclusive independent contractors of the appointing entity, may not require, directly or indirectly, as a condition of such appointment or the continuation of such appointment, the taking of an approved course or program by any appointee or potential appointee which is not of the appointee’s choosing.
(b) Any entity created or existing pursuant to s. 627.351 may require employees to take training of any type relevant to their employment but may not require appointees who are not employees to take any approved course or program unless the course or program deals solely with the appointing entity’s internal procedures or products or with subjects substantially unique to the appointing entity.
(5) For good cause shown, the department may grant an extension of time during which the requirements of this section may be completed, but such extension may not exceed 1 year.
(6) A nonresident licensee who must complete continuing education requirements in his or her home state may use the home state requirements to also meet this state’s continuing education requirements if the licensee’s home state recognizes reciprocity with this state’s continuing education requirements. A nonresident licensee whose home state does not have a continuing education requirement but is licensed for the same class of business in another state that has a continuing education requirement may comply with this section by furnishing proof of compliance with the other state’s requirement if that state has a reciprocal agreement with this state relative to continuing education. A nonresident licensee whose home state does not have such continuing education requirements, and who is not licensed as a nonresident licensee in a state that has continuing education requirements and reciprocates with this state, must meet the continuing education requirements of this state.
3(7) Any person who holds a license to solicit or sell life insurance in this state must complete a minimum of 3 hours in continuing education, approved by the department, on the subject of suitability in annuity and life insurance transactions. This requirement does not apply to an agent who does not have any active life insurance or annuity contracts. In applying this exemption, the department may require the filing of a certification attesting that the agent has not sold life insurance or annuities during the continuing education compliance cycle in question and does not have any active life insurance or annuity contracts. A licensee may use the hours obtained under this paragraph to satisfy the requirement for continuing education in ethics under paragraph (3)(a).
(8) The following courses may be completed in order to meet the elective continuing education course requirements:
(a) Any part of the Life Underwriter Training Council Life Course Curriculum: 24 hours; Health Course: 12 hours.
(b) Any part of the American College “CLU” diploma curriculum: 24 hours.
(c) Any part of the Insurance Institute of America’s program in general insurance: 12 hours.
(d) Any part of the American Institute for Property and Liability Underwriters’ Chartered Property Casualty Underwriter (CPCU) professional designation program: 24 hours.
(e) Any part of the Certified Insurance Counselor program: 21 hours.
(f) Any part of the Accredited Advisor in Insurance: 21 hours.
(g) In the case of title agents, completion of the Certified Land Closer (CLC) professional designation program and receipt of the designation: 24 hours.
(h) In the case of title agents, completion of the Certified Land Searcher (CLS) professional designation program and receipt of the designation: 24 hours.
(i) Any insurance-related course that is approved by the department and taught by an accredited college or university per credit hour granted: 12 hours.
(j) Any course, including courses relating to agency management or errors and omissions, developed or sponsored by an authorized insurer or recognized agents’ association or insurance trade association or an independent study program of instruction, subject to approval by the department, qualifies for the equivalency of the number of classroom hours assigned by the department. However, unless otherwise provided in this section, continuing education hours may not be credited toward meeting the requirements of this section unless the course is provided by classroom instruction or results in a monitored examination. A monitored examination is not required for:
1. An independent study program of instruction presented through interactive, online technology that the department determines has sufficient internal testing to validate the student’s full comprehension of the materials presented; or
2. An independent study program of instruction presented on paper or in printed material which imposes a final closed book examination that meets the requirements of the department’s rule for self-study courses. The examination may be taken without a proctor if the student presents to the provider a sworn affidavit certifying that the student did not consult any written materials or receive outside assistance of any kind or from any person, directly or indirectly, while taking the examination. If the student is an employee of an agency or corporate entity, the student’s supervisor or a manager or owner of the agency or corporate entity must also sign the sworn affidavit. If the student is self-employed, a sole proprietor, or a partner, or if the examination is administered online, the sworn affidavit must also be signed by a disinterested third party. The sworn affidavit must be received by the approved provider before reporting continuing education credits to the department.
(9) Each person or entity sponsoring a course for continuing education credit must furnish, within 21 days after completion of the course, in a form satisfactory to the department or its designee, a roster showing the name and license number of all persons successfully completing such course and requesting credit.
(10) The department may immediately terminate or refuse to renew the appointment of an agent or adjuster who has been notified by the department that his or her continuing education requirements have not been certified, unless the agent or adjuster has been granted an extension or waiver by the department. The department may not issue a new appointment of the same or similar type to a licensee who was denied a renewal appointment for failing to complete continuing education as required until the licensee completes his or her continuing education requirement.
(11) The department may contract services relative to the administration of the continuing education program to a private entity. The contract shall be procured as a contractual service pursuant to s. 287.057.
History.—ss. 1, 2, ch. 89-210; ss. 28, 207, ch. 90-363; s. 58, ch. 91-108; s. 10, ch. 91-296; s. 4, ch. 91-429; s. 10, ch. 92-146; s. 8, ch. 92-318; s. 1, ch. 96-377; s. 1723, ch. 97-102; s. 1, ch. 2000-297; ss. 13, 52, ch. 2002-206; s. 926, ch. 2003-261; s. 28, ch. 2003-267; s. 21, ch. 2003-281; s. 15, ch. 2004-374; s. 11, ch. 2005-257; s. 16, ch. 2007-1; s. 26, ch. 2008-220; s. 3, ch. 2008-237; s. 1, ch. 2010-61; s. 46, ch. 2010-175; s. 1, ch. 2012-206; ss. 10, 11, ch. 2012-209.
1Note.—Section 11, ch. 2012-209, amended subsection (3), effective October 1, 2014, to read:
(3) Each licensee except a title insurance agent must complete a 5-hour update course every 2 years which is specific to the license held by the licensee. The course must be developed and offered by providers and approved by the department. The content of the course must address all lines of insurance for which examination and licensure are required and include the following subject areas: insurance law updates, ethics for insurance professionals, disciplinary trends and case studies, industry trends, premium discounts, determining suitability of products and services, and other similar insurance-related topics the department determines are relevant to legally and ethically carrying out the responsibilities of the license granted. A licensee who holds multiple insurance licenses must complete an update course that is specific to at least one of the licenses held. Except as otherwise specified, any remaining required hours of continuing education are elective and may consist of any continuing education course approved by the department under this section.
(a) Except as provided in paragraphs (b), (c), (d), (e), and (i), each licensee must also complete 19 hours of elective continuing education courses every 2 years.
(b) A licensee who has been licensed for 6 or more years must also complete a minimum of 15 hours of elective continuing education every 2 years.
(c) A licensee who has been licensed for 25 years or more and is a CLU or a CPCU or has a Bachelor of Science degree in risk management or insurance with evidence of 18 or more semester hours in insurance-related courses must also complete a minimum of 5 hours of elective continuing education courses every 2 years.
(d) An individual who holds a license as a customer representative, limited customer representative, motor vehicle physical damage and mechanical breakdown insurance agent, or an industrial fire insurance or burglary insurance agent and who is not a licensed life or health agent, must also complete a minimum of 5 hours of continuing education courses every 2 years.
(e) An individual subject to chapter 648 must complete the 5-hour update course and a minimum of 9 hours of elective continuing education courses every 2 years.
(f) Elective continuing education courses for public adjusters must be specifically designed for public adjusters and approved by the department. Notwithstanding this subsection, public adjusters for workers’ compensation insurance or health insurance are not required to take continuing education courses pursuant to this section.
(g) Excess hours accumulated during any 2-year compliance period may be carried forward to the next compliance period.
(h) An individual teaching an approved course of instruction or lecturing at any approved seminar and attending the entire course or seminar qualifies for the same number of classroom hours as would be granted to a person taking and successfully completing such course or seminar. Credit is limited to the number of hours actually taught unless a person attends the entire course or seminar. An individual who is an official of or employed by a governmental entity in this state and serves as a professor, instructor, or 2in another position or office, the duties and responsibilities of which are determined by the department to require monitoring and review of insurance laws or insurance regulations and practices, is exempt from this section.
(i) For compliance periods beginning on or after October 1, 2014, any person who holds a license as a title insurance agent must complete a minimum of 10 hours of continuing education credit every 2 years in title insurance and escrow management specific to this state and approved by the department, which shall include at least 3 hours of continuing education on the subject matter of ethics, rules, or compliance with state and federal regulations relating specifically to title insurance and closing services.
2Note.—The words “in another” were substituted for the word “other” by the editors to improve clarity.
3Note.—
A. Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
B. Section 11, ch. 2012-209, deleted subsection (7), effective October 1, 2014.
626.2816 Regulation of continuing education for licensees, course providers, instructors, school officials, and monitor groups.—
(1) Continuing education course providers, instructors, school officials, and monitor groups must be approved by the department before offering continuing education courses pursuant to s. 626.2815 or s. 626.869.
(2) The department shall adopt rules establishing standards for the approval, regulation, and operation of the continuing education programs and for the discipline of licensees, course providers, instructors, school officials, and monitor groups. The standards must be designed to ensure that such course providers, instructors, school officials, and monitor groups have the knowledge, competence, and integrity to fulfill the educational objectives of ss. 626.2815, 626.869, 648.385, and 648.386.
(3) The department shall adopt rules establishing a process by which compliance with the continuing education requirements of ss. 626.2815, 626.869, 648.385, and 648.386 can be determined, the establishment of a continuing education compliance period for licensees, and forms necessary to implement such a process.
History.—s. 1, ch. 98-103; s. 29, ch. 2003-267; s. 22, ch. 2003-281.
626.2817 Regulation of course providers, instructors, school officials, and monitor groups involved in prelicensure education for insurance agents and other licensees.—
(1) Any course provider, instructor, school official, or monitor group must be approved by and registered with the department before offering prelicensure education courses for insurance agents and other licensees.
(2) The department shall adopt rules establishing standards for the approval, registration, discipline, or removal from registration of course providers, instructors, school officials, and monitor groups. The standards must be designed to ensure that such persons have the knowledge, competence, and integrity to fulfill the educational objectives of the prelicensure requirements of this chapter and chapter 648 and to assure that insurance agents and licensees are competent to engage in the activities authorized under the license.
(3) The department shall adopt rules to establish a process for determining compliance with the prelicensure requirements of this chapter and chapter 648. The department shall adopt rules prescribing the forms necessary to administer the prelicensure requirements.
History.—s. 6, ch. 2000-370; s. 927, ch. 2003-261; s. 30, ch. 2003-267; s. 23, ch. 2003-281; s. 34, ch. 2004-390.
626.291 Examination results; denial, issuance of license.—
(1) Within 30 days after the applicant has completed any examination required under s. 626.221, the department or its designee shall provide a score report; and, if it finds that the applicant has received a passing grade, the department shall within such period notify the applicant and issue and transmit the license to which such examination related. If it finds that the applicant did not make a passing grade on the examination for a particular license, the department or its designee shall within this period provide notice to the applicant to that effect and of its denial of the license. For those applicants who have completed the examination and received a passing grade prior to submitting the license application, the department shall promptly issue the license applied for as soon as the department approves the application.
(2) As to an applicant for a license for which no examination is required, the department shall promptly issue the license applied for as soon as it has approved the application.
(3) A passing grade on an examination is valid for a period of 1 year. The department shall not issue a license to an applicant based on an examination taken more than 1 year prior to the date that an application for license is filed.
History.—s. 208, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 172, 217, 807, 810, ch. 82-243; s. 18, ch. 82-386; s. 64, ch. 89-360; ss. 29, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 928, ch. 2003-261; s. 35, ch. 2004-390; s. 10, ch. 2006-184.
626.292 Transfer of license from another state.—
(1) An individual licensed in good standing in another state may apply to the department to have the license transferred to this state to obtain a resident agent or all-lines adjuster license for the same lines of authority covered by the license in the other state.
(2) To qualify for a license transfer, an individual applicant must meet the following requirements:
(a) The individual must become a resident of this state.
(b) The individual must have been licensed in another state for a minimum of 1 year immediately preceding the date the individual became a resident of this state.
(c) The individual must submit a completed application for this state which is received by the department within 90 days after the date the individual became a resident of this state, along with payment of the applicable fees set forth in s. 624.501 and submission of the following documents:
1. A certification issued by the appropriate official of the applicant’s home state identifying the type of license and lines of authority under the license and stating that, at the time the license from the home state was canceled, the applicant was in good standing in that state or that the state’s Producer Database records, maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries, indicate that the agent or all-lines adjuster is or was licensed in good standing for the line of authority requested.
2. A set of the applicant’s fingerprints in accordance with s. 626.171(4).
(d) The individual must satisfy prelicensing education requirements in this state, unless the completion of prelicensing education requirements was a prerequisite for licensure in the other state and the prelicensing education requirements in the other state are substantially equivalent to the prelicensing requirements of this state as determined by the department. This paragraph does not apply to all-lines adjusters.
(e) The individual must satisfy the examination requirement under s. 626.221, unless exempted.
(3) An applicant satisfying the requirements for a license transfer under subsection (2) shall be approved for licensure in this state unless the department finds that grounds exist under s. 626.611 or s. 626.621 for refusal, suspension, or revocation of a license.
History.—s. 14, ch. 2002-206; s. 929, ch. 2003-261; s. 12, ch. 2005-257; s. 12, ch. 2012-209.
626.301 Form and contents of licenses, in general.—Each license issued by the department shall be in such form as the department may designate and contain the licensee’s name, lines of authority the licensee is authorized to transact, the licensee’s personal identification number, the date of issuance, and any other information the department deems necessary to fully identify the licensee and the authority being granted. The department may by rule require photographs of applicants as a part of the licensing process.
History.—s. 209, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 173, 217, 807, 810, ch. 82-243; s. 19, ch. 82-386; ss. 30, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 15, ch. 2002-206; s. 930, ch. 2003-261; s. 36, ch. 2004-390.
626.311 Scope of license.—
(1) Except as to personal lines agents and limited licenses, a general lines agent or customer representative shall qualify for all property, marine, casualty, and surety lines except bail bonds which require a separate license under chapter 648. The license of a general lines agent may also cover health insurance if health insurance is included in the agent’s appointment by an insurer as to which the licensee is also appointed as agent for property or casualty or surety insurance. The license of a customer representative shall provide, in substance, that it covers all of such classes of insurance that his or her appointing general lines agent or agency is currently so authorized to transact under the general lines agent’s license and appointments. No such license shall be issued limited to particular classes of insurance except for bail bonds which require a separate license under chapter 648 or for personal lines agents. Personal lines agents are limited to transacting business related to property and casualty insurance sold to individuals and families for noncommercial purposes.
(2) Except with respect to a limited license as a credit insurance agent, the license of a life agent covers all classes of life insurance business.
(3) Except with respect to a limited license as a travel insurance agent, the license of a health agent covers all kinds of health insurance and such license may not be limited to a particular class of health insurance.
(4) No agent licensee shall transact or attempt to transact under his or her license any line of insurance for which he or she does not have currently in force of record with the department an appointment by an authorized insurer.
(5) At any time while a license is in force, an insurer may apply to the department on behalf of the licensee for an appointment. Upon receipt of the appointment application and appointment taxes and fees, the department may issue the additional appointment without further investigation concerning the applicant.
(6) The department may contract with other persons to administer the appointment process.
History.—s. 210, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; s. 68, ch. 82-175; ss. 174, 217, 807, 810, ch. 82-243; s. 20, ch. 82-386; s. 87, ch. 83-216; ss. 31, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 221, ch. 97-102; s. 17, ch. 98-199; s. 31, ch. 2003-267; s. 24, ch. 2003-281; s. 19, ch. 2004-374; s. 13, ch. 2012-209.
626.321 Limited licenses.—
(1) The department shall issue to a qualified applicant a license as agent authorized to transact a limited class of business in any of the following categories of limited lines insurance:
(a) Motor vehicle physical damage and mechanical breakdown insurance.—License covering insurance against only the loss of or damage to a motor vehicle that is designed for use upon a highway, including trailers and semitrailers designed for use with such vehicles. Such license also covers insurance against the failure of an original or replacement part to perform any function for which it was designed. A licensee under this paragraph may not hold a license as an agent for any other or additional kind or class of insurance coverage except a limited license for credit insurance as provided in paragraph (e). Effective October 1, 2012, all licensees holding such limited license and appointment may renew the license and appointment, but no new or additional licenses may be issued pursuant to this paragraph, and a licensee whose limited license under this paragraph has been terminated, suspended, or revoked may not have such license reinstated.
(b) Industrial fire insurance or burglary insurance.—License covering only industrial fire insurance or burglary insurance. The applicant for such a license must pass a written examination covering such insurance. A licensee under this paragraph may not hold a license as an agent for any other or additional kind or class of insurance coverage except for life insurance and health insurance.
(c) Travel insurance.—License covering only policies and certificates of travel insurance which are subject to review by the office. Policies and certificates of travel insurance may provide coverage for risks incidental to travel, planned travel, or accommodations while traveling, including, but not limited to, accidental death and dismemberment of a traveler; trip or event cancellation, interruption, or delay; loss of or damage to personal effects or travel documents; damages to travel accommodations; baggage delay; emergency medical travel or evacuation of a traveler; or medical, surgical, and hospital expenses related to an illness or emergency of a traveler. Such policy or certificate may be issued for terms longer than 90 days, but, other than a policy or certificate providing coverage for air ambulatory services only, each policy or certificate must be limited to coverage for travel or use of accommodations of no longer than 90 days. The license may be issued only:
1. To a full-time salaried employee of a common carrier or a full-time salaried employee or owner of a transportation ticket agency and may authorize the sale of such ticket policies only in connection with the sale of transportation tickets, or to the full-time salaried employee of such an agent. Such policy may not be for more than 48 hours or more than the duration of a specified one-way trip or round trip.
2. To an entity or individual that is:
a. The developer of a timeshare plan that is the subject of an approved public offering statement under chapter 721;
b. An exchange company operating an exchange program approved under chapter 721;
c. A managing entity operating a timeshare plan approved under chapter 721;
d. A seller of travel as defined in chapter 559; or
e. A subsidiary or affiliate of any of the entities described in sub-subparagraphs a.-d.
3. To a full-time salaried employee of a licensed general lines agent or a business entity that offers travel planning services if insurance sales activities authorized by the license are in connection with, and incidental to, travel.
a. A license issued to a business entity that offers travel planning services must encompass each office, branch office, or place of business making use of the entity’s business name in order to offer, solicit, and sell insurance pursuant to this paragraph.
b. The application for licensure must list the name, address, and phone number for each office, branch office, or place of business that is to be covered by the license. The licensee shall notify the department of the name, address, and phone number of any new location that is to be covered by the license before the new office, branch office, or place of business engages in the sale of insurance pursuant to this paragraph. The licensee shall notify the department within 30 days after the closing or terminating of an office, branch office, or place of business. Upon receipt of the notice, the department shall delete the office, branch office, or place of business from the license.
c. A licensed and appointed entity is directly responsible and accountable for all acts of the licensee’s employees and parties with whom the licensee has entered into a contractual agreement to offer travel insurance.
A licensee shall require each individual who offers policies or certificates under subparagraph 2. or subparagraph 3. to receive initial training from a general lines agent or an insurer authorized under chapter 624 to transact insurance within this state. For an entity applying for a license as a travel insurance agent, the fingerprinting requirement of this section applies only to the president, secretary, and treasurer and to any other officer or person who directs or controls the travel insurance operations of the entity.
(d) Motor vehicle rental insurance.—
1. License covering only insurance of the risks set forth in this paragraph when offered, sold, or solicited with and incidental to the rental or lease of a motor vehicle and which applies only to the motor vehicle that is the subject of the lease or rental agreement and the occupants of the motor vehicle:
a. Excess motor vehicle liability insurance providing coverage in excess of the standard liability limits provided by the lessor in the lessor’s lease to a person renting or leasing a motor vehicle from the licensee’s employer for liability arising in connection with the negligent operation of the leased or rented motor vehicle.
b. Insurance covering the liability of the lessee to the lessor for damage to the leased or rented motor vehicle.
c. Insurance covering the loss of or damage to baggage, personal effects, or travel documents of a person renting or leasing a motor vehicle.
d. Insurance covering accidental personal injury or death of the lessee and any passenger who is riding or driving with the covered lessee in the leased or rented motor vehicle.
2. Insurance under a motor vehicle rental insurance license may be issued only if the lease or rental agreement is for no more than 60 days, the lessee is not provided coverage for more than 60 consecutive days per lease period, and the lessee is given written notice that his or her personal insurance policy providing coverage on an owned motor vehicle may provide coverage of such risks and that the purchase of the insurance is not required in connection with the lease or rental of a motor vehicle. If the lease is extended beyond 60 days, the coverage may be extended one time only for a period not to exceed an additional 60 days. Insurance may be provided to the lessee as an additional insured on a policy issued to the licensee’s employer.
3. The license may be issued only to the full-time salaried employee of a licensed general lines agent or to a business entity that offers motor vehicles for rent or lease if insurance sales activities authorized by the license are in connection with and incidental to the rental or lease of a motor vehicle.
a. A license issued to a business entity that offers motor vehicles for rent or lease encompasses each office, branch office, or place of business making use of the entity’s business name in order to offer, solicit, and sell insurance pursuant to this paragraph.
b. The application for licensure must list the name, address, and phone number for each office, branch office, or place of business that is to be covered by the license. The licensee shall notify the department of the name, address, and phone number of any new location that is to be covered by the license before the new office, branch office, or place of business engages in the sale of insurance pursuant to this paragraph. The licensee must notify the department within 30 days after closing or terminating an office, branch office, or place of business. Upon receipt of the notice, the department shall delete the office, branch office, or place of business from the license.
c. A licensed and appointed entity is directly responsible and accountable for all acts of the licensee’s employees.
(e) Credit insurance.—License covering credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed automobile protection (GAP) insurance, and any other form of insurance offered in connection with an extension of credit which is limited to partially or wholly extinguishing a credit obligation that the department determines should be designated a form of limited line credit insurance. Effective October 1, 2012, all valid licenses held by persons for any of the lines of insurance listed in this paragraph shall be converted to a credit insurance license. Licensees who wish to obtain a new license reflecting such change must request a duplicate license and pay a $5 fee as specified in s. 624.501(15). The license may be issued only to an individual employed by a life or health insurer as an officer or other salaried or commissioned representative, to an individual employed by or associated with a lending or financial institution or creditor, or to a lending or financial institution or creditor, and may authorize the sale of such insurance only with respect to borrowers or debtors of such lending or financing institution or creditor. However, only the individual or entity whose tax identification number is used in receiving or is credited with receiving the commission from the sale of such insurance shall be the licensed agent of the insurer. No individual while so licensed shall hold a license as an agent as to any other or additional kind or class of life or health insurance coverage.
(f) Crop hail and multiple-peril crop insurance.—License for insurance covering crops subject to unfavorable weather conditions, fire or lightening, flood, hail, insect infestation, disease, or other yield-reducing conditions or perils which is provided by the private insurance market, or which is subsidized by the Federal Group Insurance Corporation including multi-peril crop insurance. Notwithstanding any other provision of law, the limited license may be issued to a bona fide salaried employee of an association chartered under the Farm Credit Act of 1971, 12 U.S.C. ss. 2001 et seq., who satisfactorily completes the examination prescribed by the department pursuant to s. 626.241(5). The agent must be appointed by, and his or her limited license requested by, a licensed general lines agent. All business transacted by the agent must be on behalf of, in the name of, and countersigned by the agent by whom he or she is appointed. Sections 626.561 and 626.748, relating to records, apply to all business written pursuant to this section. The licensee may be appointed by and licensed for only one general lines agent or agency.
(g) In-transit and storage personal property insurance.— License for insurance covering only personal property not held for resale, covering the risks of transportation or storage in rented or leased motor vehicles, trailers, or self-service storage facilities as defined in s. 83.803. Such license may be issued, without examination, only to employees or authorized representatives of lessors who rent or lease motor vehicles, trailers, or self-service storage facilities and who are authorized by an insurer to issue certificates or other evidences of insurance to lessees of such motor vehicles, trailers, or self-service storage facilities under an insurance policy issued to the lessor. A person licensed under this paragraph must give a prospective purchaser of in-transit or storage personal property insurance written notice that his or her homeowner’s policy may provide coverage for the loss of personal property and that the purchase of such insurance is not required under the lease terms.
(h) Portable electronics insurance.—License for property insurance or inland marine insurance that covers only loss, theft, mechanical failure, malfunction, or damage for portable electronics.
1. The license may be issued only to:
a. Employees or authorized representatives of a licensed general lines agent; or
b. The lead business location of a retail vendor that sells portable electronics insurance. The lead business location must have a contractual relationship with a general lines agent.
2. Employees or authorized representatives of a licensee under subparagraph 1. may sell or offer for sale portable electronics coverage without being subject to licensure as an insurance agent if:
a. Such insurance is sold or offered for sale at a licensed location or at one of the licensee’s branch locations if the branch location is appointed by the licensed lead business location or its appointing insurers;
b. The insurer issuing the insurance directly supervises or appoints a general lines agent to supervise the sale of such insurance, including the development of a training program for the employees and authorized representatives of vendors that are directly engaged in the activity of selling or offering the insurance; and
c. At each location where the insurance is offered, brochures or other written materials that provide the information required by this subparagraph are made available to all prospective customers. The brochures or written materials may include information regarding portable electronics insurance, service warranty agreements, or other incidental services or benefits offered by a licensee.
3. Individuals not licensed to sell portable electronics insurance may not be paid commissions based on the sale of such coverage. However, a licensee who uses a compensation plan for employees and authorized representatives which includes supplemental compensation for the sale of noninsurance products, in addition to a regular salary or hourly wages, may include incidental compensation for the sale of portable electronics insurance as a component of the overall compensation plan.
4. Brochures or other written materials related to portable electronics insurance must:
a. Disclose that such insurance may duplicate coverage already provided by a customer’s homeowners’ insurance policy, renters’ insurance policy, or other source of coverage;
b. State that enrollment in insurance coverage is not required in order to purchase or lease portable electronics or services;
c. Summarize the material terms of the insurance coverage, including the identity of the insurer, the identity of the supervising entity, the amount of any applicable deductible and how it is to be paid, the benefits of coverage, and key terms and conditions of coverage, such as whether portable electronics may be repaired or replaced with similar make and model reconditioned or nonoriginal manufacturer parts or equipment;
d. Summarize the process for filing a claim, including a description of how to return portable electronics and the maximum fee applicable if the customer fails to comply with equipment return requirements; and
e. State that an enrolled customer may cancel coverage at any time and that the person paying the premium will receive a refund of any unearned premium.
5. A licensed and appointed general lines agent is not required to obtain a portable electronics insurance license to offer or sell portable electronics insurance at locations already licensed as an insurance agency, but may apply for a portable electronics insurance license for branch locations not otherwise licensed to sell insurance.
6. A portable electronics license authorizes the sale of individual policies or certificates under a group or master insurance policy. The license also authorizes the sale of service warranty agreements covering only portable electronics to the same extent as if licensed under s. 634.419 or s. 634.420.
7. A licensee may bill and collect the premium for the purchase of portable electronics insurance provided that:
a. If the insurance is included with the purchase or lease of portable electronics or related services, the licensee clearly and conspicuously discloses that insurance coverage is included with the purchase. Disclosure of the stand-alone cost of the premium for same or similar insurance must be made on the customer’s bill and in any marketing materials made available at the point of sale. If the insurance is not included, the charge to the customer for the insurance must be separately itemized on the customer’s bill.
b. Premiums are incidental to other fees collected, are maintained in a manner that is readily identifiable, and are accounted for and remitted to the insurer or supervising entity within 60 days of receipt. Licensees are not required to maintain such funds in a segregated account.
c. All funds received by a licensee from an enrolled customer for the sale of the insurance are considered funds held in trust by the licensee in a fiduciary capacity for the benefit of the insurer. Licensees may receive compensation for billing and collection services.
8. Notwithstanding any other provision of law, the terms for the termination or modification of coverage under a policy of portable electronics insurance are those set forth in the policy.
9. Notice or correspondence required by the policy, or otherwise required by law, may be provided by electronic means if the insurer or licensee maintains proof that the notice or correspondence was sent. Such notice or correspondence may be sent on behalf of the insurer or licensee by the general lines agent appointed by the insurer to supervise the administration of the program. For purposes of this subparagraph, an enrolled customer’s provision of an electronic mail address to the insurer or licensee is deemed to be consent to receive notices and correspondence by electronic means if a conspicuously located disclosure is provided to the customer indicating the same.
10. The provisions of this chapter requiring submission of fingerprints do not apply to licenses issued to qualified entities under this paragraph.
11. A branch location that sells portable electronics insurance may, in lieu of obtaining an appointment from an insurer or warranty association, obtain a single appointment from the associated lead business location licensee and pay the prescribed appointment fee under s. 624.501 if the lead business location has a single appointment from each insurer or warranty association represented and such appointment applies to the lead business location and all of its branch locations. Branch location appointments shall be renewed 24 months after the initial appointment date of the lead business location and every 24 months thereafter. Notwithstanding s. 624.501, the renewal fee applicable to such branch location appointments is $30 per appointment.
12. For purposes of this paragraph:
a. “Branch location” means any physical location in this state at which a licensee offers its products or services for sale.
b. “Portable electronics” means personal, self-contained, easily carried by an individual, battery-operated electronic communication, viewing, listening, recording, gaming, computing or global positioning devices, including cell or satellite phones, pagers, personal global positioning satellite units, portable computers, portable audio listening, video viewing or recording devices, digital cameras, video camcorders, portable gaming systems, docking stations, automatic answering devices, and other similar devices and their accessories, and service related to the use of such devices.
c. “Portable electronics transaction” means the sale or lease of portable electronics or a related service, including portable electronics insurance.
(2) An entity applying for a license under this section is required to:
(a) Submit only one application for a license under s. 626.171. The requirements of s. 626.171(4) shall only apply to the officers and directors of the entity submitting the application.
(b) Obtain a license for each office, branch office, or place of business making use of the entity’s business name by applying to the department for the license on a simplified application form developed by rule of the department for this purpose.
(c) Pay the applicable fees for a license as prescribed in s. 624.501, be appointed under s. 626.112, and pay the prescribed appointment fee under s. 624.501. A licensed and appointed entity shall be directly responsible and accountable for all acts of the licensee’s employees.
(3) The limitations of any license issued under this section shall be expressed therein. The licensee shall have a separate and additional appointment as to each insurer represented.
(4) Except as otherwise expressly provided, a person applying for or holding a limited license is subject to the same applicable requirements and responsibilities that apply to general lines agents in general if licensed as to motor vehicle physical damage and mechanical breakdown insurance, industrial fire insurance or burglary insurance, motor vehicle rental insurance, credit insurance, crop hail and multiple-peril crop insurance, in-transit and storage personal property insurance, or portable electronics insurance; or as apply to life agents or health agents in general, as applicable, if licensed as to travel insurance.
(5) Nothing in this section shall permit the sale of an insurance policy or certificate for any limited class of business in a category identified under subsection (1) by a person or entity other than an insurance policy or certificate offered by an authorized insurer in this state or an eligible surplus lines insurer in this state.
History.—s. 211, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 4, ch. 79-156; s. 1, ch. 80-149; ss. 1, 7, ch. 80-387; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 175, 217, 807, 810, ch. 82-243; s. 21, ch. 82-386; s. 1, ch. 83-54; s. 1, ch. 84-88; s. 1, ch. 85-112; s. 1, ch. 86-274; s. 1, ch. 87-206; s. 1, ch. 88-197; ss. 32, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 222, ch. 97-102; s. 5, ch. 97-214; s. 9, ch. 97-292; s. 18, ch. 98-199; s. 21, ch. 99-3; s. 38, ch. 99-7; ss. 1, 11, ch. 99-204; s. 5, ch. 99-388; s. 1, ch. 2001-111; s. 2, ch. 2002-84; ss. 16, 53, ch. 2002-206; s. 80, ch. 2003-1; s. 1, ch. 2003-266; s. 32, ch. 2003-267; s. 25, ch. 2003-281; s. 8, ch. 2004-370; s. 25, ch. 2004-374; s. 153, ch. 2004-390; s. 1, ch. 2005-195; s. 13, ch. 2005-257; s. 2, ch. 2007-76; s. 41, ch. 2011-194; s. 7, ch. 2012-151; s. 14, ch. 2012-209.
626.322 License, appointment; certain military installations.—A natural person, not a resident of this state, may be licensed and appointed to represent an authorized life insurer domiciled in this state or an authorized foreign life insurer which maintains a regional home office in this state, provided such person represents such insurer exclusively at a United States military installation located in a foreign country. The department may, upon request of the applicant and the insurer on application forms furnished by the department and upon payment of fees as prescribed in s. 624.501, issue a license and appointment to such person. By authorizing the effectuation of an appointment for a license, the insurer is thereby certifying to the department that the applicant has the necessary training to hold himself or herself out as a life insurance representative, and the insurer shall further certify that it is willing to be bound by the acts of such applicant within the scope of his or her employment. Appointments shall be continued as prescribed in s. 626.381 and upon payment of a fee as prescribed in s. 624.501, unless sooner terminated. Such fees received shall be credited to the Insurance Regulatory Trust Fund as provided for in s. 624.523.
History.—s. 1, ch. 65-545; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 176, 217, 807, 810, ch. 82-243; s. 22, ch. 82-386; ss. 33, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 223, ch. 97-102; s. 931, ch. 2003-261; s. 33, ch. 2003-267; s. 26, ch. 2003-281.
626.331 Number of appointments permitted or required.—
(1) Except as otherwise expressly provided in this code, the same individual may at any one time hold any and all categories of appointments as to which he or she has qualified and been licensed under this code.
(2) An agent shall be required to have a separate appointment as to each insurer by whom he or she is appointed as an agent. An agent must appoint himself or herself before performing the functions of a viatical settlement broker.
(3) The department may issue a single appointment covering both life and health insurances to an individual licensed as to both such kinds of insurance and appointed as agent as to both such kinds by the same insurer.
(4) If requested in writing by the applicant or payor entitled thereto within 60 days after the denial or disapproval of an appointment, the department shall refund to the applicant or payor entitled thereto any state and county taxes received by it in connection with the application for the appointment. The appointment fee is not subject to refund. No refund shall be made under any circumstances after issuance of an appointment. No refund shall be made if the applicable appointment year has commenced before receipt by the department of the request for cancellation of the appointment and refund.
(5) A title agent or title agency license must be limited to selling title insurance only for the appointing title insurer or insurers.
History.—s. 212, ch. 59-205; s. 1, ch. 63-17; ss. 13, 35, ch. 69-106; s. 1, ch. 71-57; s. 2, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 177, 217, 807, 810, ch. 82-243; s. 9, ch. 85-208; ss. 34, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 9, ch. 92-318; s. 224, ch. 97-102; s. 19, ch. 98-199; s. 10, ch. 2005-237.
626.341 Additional appointments; general lines, life, and health agents.—
(1) At any time while a licensee’s license is in force, an insurer may apply to the department or person designated by the department to administer the appointment process on behalf of a licensee for an additional appointment as general lines agent or life or health agent for an additional insurer or insurers. The application for appointment shall set forth all information the department may require. Upon receipt of the appointment and payment of the applicable appointment taxes and fees, the department may issue the additional appointment without, in its discretion, further investigation concerning the applicant.
(2) A life or health agent with an appointment in force may solicit applications for policies of insurance on behalf of an insurer with respect to which he or she is not an appointed life or health agent, unless otherwise provided by contract, if such agent simultaneously with the submission to such insurer of the application for insurance solicited by him or her requests the insurer to appoint him or her as agent. However, no commissions shall be paid by such insurer to the agent until such time as an additional appointment with respect to such insurer has been received by the department or person designated by the department to administer the appointment process pursuant to the provisions of subsection (1).
History.—s. 213, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 7, 10, ch. 80-341; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 178, 217, 807, 810, ch. 82-243; s. 10, ch. 85-208; ss. 35, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 225, ch. 97-102; s. 34, ch. 2003-267; s. 27, ch. 2003-281.
626.342 Furnishing supplies to unlicensed agent prohibited; civil liability.—
(1) An insurer, a managing general agent, an insurance agency, or an agent, directly or through a representative, may not furnish to an agent any blank forms, applications, stationery, or other supplies to be used in soliciting, negotiating, or effecting contracts of insurance on its behalf unless such blank forms, applications, stationery, or other supplies relate to a class of business for which the agent is licensed and appointed, whether for that insurer or another insurer.
(2) An insurer, general agent, insurance agency, or agent who furnishes any of the supplies specified in subsection (1) to an agent or prospective agent not appointed to represent the insurer and who accepts from or writes any insurance business for such agent or agency is subject to civil liability to an insured of such insurer to the same extent and manner as if such agent or prospective agent had been appointed or authorized by the insurer or such agent to act on its or his or her behalf. The provisions of this subsection do not apply to insurance risk apportionment plans under s. 627.351.
(3) This section does not apply to the placing of surplus lines business under the provisions of ss. 626.913-626.937.
History.—ss. 8, 10, ch. 80-341; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 179, 217, 807, 810, ch. 82-243; s. 1, ch. 84-75; ss. 36, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 226, ch. 97-102; s. 20, ch. 98-199; s. 14, ch. 2005-257; s. 15, ch. 2012-209.
626.371 Payment of fees, taxes for appointment period without appointment.—
(1) All initial appointments shall be submitted to the department on a monthly basis no later than 45 days after the date of appointment and become effective on the date requested on the appointment form.
(2) If, upon application and qualification for an initial or renewal appointment and such investigation as the department may make, it appears to the department that an individual who was formerly licensed or is currently licensed but not properly appointed to represent an insurer or employer and who has been actively engaged or is currently actively engaged as such an appointee, but without being appointed as required, the department may, if it finds that such failure to be appointed was an inadvertent error on the part of the insurer or employer so represented, nevertheless issue or authorize the issuance of the appointment as applied for but subject to the condition that, before the appointment is issued, all fees and taxes which would have been due had the applicant been so appointed during such current and prior periods, with applicable fees pursuant to s. 624.501 for such current and prior periods of appointment, shall be paid to the department.
(3)(a) Failure to notify the department within the required time period shall result in the appointing entity being assessed a delinquent fee of $250 per appointee. Delinquent fees shall be paid by the appointing entity and may not be charged to the appointee.
(b) Failure to timely renew an appointment by an appointing entity prior to the expiration date of the appointment shall result in the appointing entity being assessed late filing, continuation, and reinstatement fees as prescribed in s. 624.501. Such fees must be paid by the appointing entity and cannot be charged back to the appointee.
History.—s. 216, ch. 59-205; s. 9, ch. 65-269; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 182(1st), 217, 807, 810, ch. 82-243; ss. 38, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 933, ch. 2003-261; s. 35, ch. 2003-267; s. 28, ch. 2003-281; s. 107, ch. 2004-5; s. 37, ch. 2004-390.
626.381 Renewal, continuation, reinstatement, or termination of appointment.—
(1) The appointment of an appointee continues in force until suspended, revoked, or otherwise terminated, but is subject to a renewal request filed by the appointing entity in the appointee’s birth month as to natural persons or the month the original appointment was issued as to entities and every 24 months thereafter, accompanied by payment of the renewal appointment fee and taxes as prescribed in s. 624.501.
(2) Each appointing entity shall file with the department the lists, statements, and information as to appointees whose appointments are being renewed or terminated, accompanied by payment of the applicable renewal fees and taxes as prescribed in s. 624.501, by a date set forth by the department following the month during which the appointments will expire.
(3) Renewal of an appointment which is received by the department or person designated by the department to administer the appointment process prior to the expiration of an appointment in the licensee’s birth month or license issue date, whichever applies, may be renewed by the department without penalty and shall be effective as of the first day of the month succeeding the month in which the appointment would have expired.
(4) Renewal of an appointment which is received by the department or person designated by the department to administer the appointment process after the renewal date may be accepted and effectuated by the department in its discretion if the appointment, late filing, continuation, and reinstatement fee accompanies the renewal request pursuant to s. 624.501. Late filing fees shall be paid by the appointing entity and may not be charged to the appointee.
(5) The appointment issued to any such appointee shall remain in effect for as long as the appointment represented thereby continues in force as provided in this section.
(6) An appointing entity may require an appointee to attend training and education programs of the appointing entity in order for the appointee to receive a new appointment or maintain an existing appointment. However, an appointing entity may not require, directly or indirectly, any appointee to attend any training programs that are wholly or partially approved for general continuing education credit as provided in s. 626.2815.
(7) Each appointing entity may appoint only those persons who have met the continuing education requirements of the license necessary for such appointment as provided in s. 626.2815. However, an appointing entity may not make or allow, directly or indirectly, the appointment of any appointee or potential appointee to be contingent, in whole or in part, on any appointee’s attendance at any course that is approved, in whole or in part, for continuing education credit pursuant to s. 626.2815.
(8) This section does not apply to temporary licenses.
(9) The department may adopt rules to implement this section.
History.—s. 217, ch. 59-205; s. 10, ch. 65-269; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 181(2nd), 217, 807, 810, ch. 82-243; ss. 39, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 11, ch. 92-146; s. 934, ch. 2003-261; s. 36, ch. 2003-267; s. 29, ch. 2003-281; s. 38, ch. 2004-390; s. 27, ch. 2008-220; s. 16, ch. 2012-209.
626.382 Continuation, expiration of license; insurance agencies.—The license of any insurance agency shall be issued for a period of 3 years and shall continue in force until canceled, suspended, revoked, or otherwise terminated. A license may be renewed by submitting a renewal request to the department on a form adopted by department rule.
History.—ss. 182(2nd), 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 15, ch. 2005-257.
626.431 Effect of expiration of license and appointment.—
(1) Upon the expiration of any person’s appointment, as provided in s. 626.381, the person shall be without any authority conferred by the appointment and shall not engage or attempt to engage in any activity requiring an appointment.
(2) When a licensee’s last appointment for a particular class of insurance has been terminated or not renewed, the department must notify the licensee that his or her eligibility for appointment as such an appointee will expire unless he or she is appointed prior to expiration of the 48-month period referred to in subsection (3).
(3) An individual who fails to maintain an appointment with an appointing entity writing the class of business listed on his or her license during any 48-month period shall not be granted an appointment for that class of insurance until he or she qualifies as a first-time applicant.
History.—s. 222, ch. 59-205; s. 5, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 189, 217, 807, 810, ch. 82-243; s. 12, ch. 85-208; ss. 40, 206, 207, ch. 90-363; s. 59, ch. 91-108; s. 4, ch. 91-429; s. 227, ch. 97-102; s. 7, ch. 2001-142; s. 935, ch. 2003-261; s. 39, ch. 2004-390.
626.441 License or appointment; transferability.—A license or appointment issued under this part is valid only as to the person named and is not transferable to another person. No licensee or appointee shall allow any other person to transact insurance by utilizing the license or appointment issued to such licensee or appointee.
History.—s. 223, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 190, 217, 807, 810, ch. 82-243; ss. 41, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.451 Appointment of agent or other representative.—
(1) Each appointing entity or person designated by the department to administer the appointment process appointing an agent, adjuster, service representative, customer representative, or managing general agent in this state shall file the appointment with the department or office and, at the same time, pay the applicable appointment fee and taxes. Every appointment shall be subject to the prior issuance of the appropriate agent’s, adjuster’s, service representative’s, customer representative’s, or managing general agent’s license.
(2) By authorizing the effectuation of an appointment for a licensee, the appointing entity is thereby certifying to the department that an investigation of the licensee has been made and that in the appointing entity’s opinion and to the best of its knowledge and belief, the licensee is of good moral character and reputation, and is fit to engage in the insurance business. The appointing entity shall provide to the department any other information the department or office may reasonably require relative to the proposed appointee.
(3) By authorizing the effectuation of the appointment of an agent, adjuster, service representative, customer representative, or managing general agent the appointing entity is thereby certifying to the department that it is willing to be bound by the acts of the agent, adjuster, service representative, customer representative, or managing general agent, within the scope of the licensee’s employment or appointment.
(4) Each appointing entity shall advise the department or office in writing within 15 days after it or its general agent, officer, or other official becomes aware that an appointee has pleaded guilty or nolo contendere to or has been found guilty of a felony after being appointed.
(5) Any law enforcement agency or state attorney’s office that is aware that an agent, adjuster, service representative, customer representative, or managing general agent has pleaded guilty or nolo contendere to or has been found guilty of a felony shall notify the department or office of such fact.
(6) Upon the filing of an information or indictment against an agent, adjuster, service representative, customer representative, or managing general agent, the state attorney shall immediately furnish the department or office a certified copy of the information or indictment.
(7) Each licensee shall advise the department in writing within 30 days after having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the laws of the United States, any state of the United States, or any other country, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
History.—s. 224, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 191, 217, 807, 810, ch. 82-243; ss. 42, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 228, ch. 97-102; s. 21, ch. 98-199; s. 54, ch. 2002-206; s. 936, ch. 2003-261; s. 37, ch. 2003-267; s. 30, ch. 2003-281; s. 16, ch. 2005-257.
626.461 Continuation of appointment of agent or other representative.—Subject to renewal or continuation by the appointing entity, the appointment of the agent, adjuster, service representative, customer representative, or managing general agent shall continue in effect until the person’s license is revoked or otherwise terminated, unless written notice of earlier termination of the appointment is filed with the department or person designated by the department to administer the appointment process by either the appointing entity or the appointee.
History.—s. 225, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 192, 217, 807, 810, ch. 82-243; ss. 43, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 81, ch. 2003-1; s. 937, ch. 2003-261; s. 38, ch. 2003-267; s. 31, ch. 2003-281; s. 40, ch. 2004-390.
626.471 Termination of appointment.—
(1) Subject to an appointee’s contract rights, an appointing entity may terminate its appointment of any appointee at any time. Except when termination is upon a ground which would subject the appointee to suspension or revocation of his or her license and appointment under s. 626.611 or s. 626.621, and except as provided by contract between the appointing entity and the appointee, the appointing entity shall give at least 60 days’ advance written notice of its intention to terminate such appointment to the appointee, either by delivery thereof to the appointee in person or by mailing it, postage prepaid, addressed to the appointee at his or her last address of record with the appointing entity. Notice so mailed shall be deemed to have been given when deposited in a United States Postal Service mail depository.
(2) As soon as possible and at all events within 30 days after terminating the appointment of an appointee, other than as to an appointment terminated by the appointing entity’s failure to continue or renew it, the appointing entity shall file written notice thereof with the department, together with a statement that it has given the appointee notice thereof as provided in subsection (1) and shall file with the department the reasons and facts involved in such termination as required under s. 626.511.
(3) Upon termination of the appointment of an appointee, whether by failure to renew or continue the appointment, the appointing entity shall:
(a) File with the department the information required under s. 626.511.
(b) Subject to the exceptions provided under subsection (1), continue the outstanding contracts transacted by an agent until the expiration date or anniversary date when the policy is a continuous policy with no expiration date. This paragraph shall not be construed to prohibit the cancellation of such contracts when not otherwise prohibited by law.
(4) An appointee may terminate the appointment at any time by giving written or electronic notice thereof to the appointing entity, department, or person designated by the department to administer the appointment process. The department shall immediately terminate the appointment and notify the appointing entity of such termination. Such termination shall be subject to the appointee’s contract rights, if any.
(5) Upon receiving notice of termination, the department or person designated by the department to administer the appointment process shall terminate the appointment.
History.—s. 226, ch. 59-205; ss. 13, 35, ch. 69-106; s. 1, ch. 71-327; s. 6, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 193(1st), 217, 807, 810, ch. 82-243; s. 13, ch. 85-208; ss. 44, 206, 207, ch. 90-363; s. 57, ch. 91-110; s. 4, ch. 91-429; s. 1, ch. 93-80; s. 229, ch. 97-102; s. 938, ch. 2003-261; s. 39, ch. 2003-267; s. 32, ch. 2003-281; s. 41, ch. 2004-390.
626.511 Reasons for termination; confidential information.—
(1) Any insurer terminating the appointment of an agent; any general lines agent terminating the appointment of a customer representative or a crop hail or multiple-peril crop insurance agent; and any employer terminating the appointment of an adjuster, service representative, or managing general agent, whether such termination is by direct action of the appointing insurer, agent, or employer or by failure to renew or continue the appointment as provided, shall file with the department or office a statement of the reasons, if any, for and the facts relative to such termination. In the case of termination of the appointment of an agent, such information may be filed by the insurer or by the general agent of the insurer.
(2) In the case of terminations by failure to renew or continue the appointment, the information required under subsection (1) shall be filed with the department or office as soon as possible, and at all events within 30 days, after the date notice of intention not to so renew or continue was filed with the department or office as required in this chapter. In all other cases, the information required under subsection (1) shall be filed with the department or office at the time, or at all events within 10 days after, notice of the termination was filed with the department or office.
(3) Any information, document, record, or statement furnished to the department or office under subsection (1) is confidential and exempt from the provisions of s. 119.07(1).
History.—s. 230, ch. 59-205; ss. 13, 35, ch. 69-106; s. 9, ch. 71-86; s. 7, ch. 72-34; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 194(2nd), 217, 807, 810, ch. 82-243; s. 25, ch. 82-386; s. 5, ch. 83-54; s. 10, ch. 88-166; ss. 45, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 2, ch. 93-80; s. 370, ch. 96-406; s. 22, ch. 98-199; s. 55, ch. 2002-206; s. 939, ch. 2003-261.
626.521 Character, credit reports.—
(1) As to each applicant who for the first time in this state is applying and qualifying for a license as agent, adjuster, service representative, customer representative, or managing general agent, the appointing insurer or its manager or general agent in this state, in the case of agents, or the appointing general lines agent, in the case of customer representatives, or the employer, in the case of service representatives and of adjusters who are not to be self-employed, shall coincidentally with such appointment or employment secure and thereafter keep on file a full detailed credit and character report made by an established and reputable independent reporting service, relative to the individual so appointed or employed.
(2) If requested by the department, the insurer, manager, general agent, general lines agent, or employer, as the case may be, shall furnish to the department, on a form adopted and furnished by the department, such information as it reasonably requires relative to such individual and investigation.
(3) As to an applicant for an adjuster’s or reinsurance intermediary’s license who is to be self-employed, the department may secure, at the cost of the applicant, a full detailed credit and character report made by an established and reputable independent reporting service relative to the applicant.
(4) Each person who for the first time in this state is applying and qualifying for a license as a reinsurance intermediary shall file with her or his application for license a full, detailed credit and character report for the 5-year period immediately prior to the date of application for license, made by an established and reputable independent reporting service, relative to the individual if a partnership or sole proprietorship, or the officers if a corporation or other legal entity.
(5) Information contained in credit or character reports furnished to or secured by the department under this section is confidential and exempt from the provisions of s. 119.07(1).
History.—s. 231, ch. 59-205; ss. 13, 35, ch. 69-106; s. 10, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 197(1st), 217, 807, 810, ch. 82-243; s. 11, ch. 88-166; ss. 46, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 43, ch. 92-146; ss. 3, 4, ch. 93-80; s. 371, ch. 96-406; s. 1724, ch. 97-102; s. 23, ch. 98-199; s. 8, ch. 2001-142; s. 56, ch. 2002-206; s. 940, ch. 2003-261; s. 42, ch. 2004-390.
626.536 Reporting of administrative actions.— Within 30 days after the final disposition of an administrative action taken against a licensee or insurance agency by a governmental agency or other regulatory agency in this or any other state or jurisdiction relating to the business of insurance, the sale of securities, or activity involving fraud, dishonesty, trustworthiness, or breach of a fiduciary duty, the licensee or insurance agency must submit a copy of the order, consent to order, or other relevant legal documents to the department. The department may adopt rules to administer this section.
History.—s. 17, ch. 2002-206; s. 17, ch. 2005-257; s. 17, ch. 2012-209.
626.541 Firm, corporate, and business names; officers; associates; notice of changes.—
(1) Any licensed agent or adjuster doing business under a firm or corporate name or under any business name other than his or her own individual name shall, within 30 days after the initial transaction of insurance under such business name, file with the department, on forms adopted and furnished by the department, a written statement of the firm, corporate, or business name being so used, the address of any office or offices or places of business making use of such name, and the name and social security number of each officer and director of the corporation and of each individual associated in such firm or corporation as to the insurance transactions thereof or in the use of such business name.
(2) In the event of any change of such name, or of any of the officers and directors, or of any of such addresses, or in the personnel so associated, written notice of such change must be filed with the department within 30 days by or on behalf of those licensees terminating any such firm, corporate, or business name or continuing to operate thereunder.
(3) Any licensed insurance agency shall, within 30 days after a change, notify the department of any change in the information contained in the application filed pursuant to s. 626.172.
History.—s. 233, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 198(2nd), 217, 807, 810, ch. 82-243; s. 27, ch. 82-386; ss. 48, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 230, ch. 97-102; s. 24, ch. 98-199; s. 9, ch. 2001-142; s. 941, ch. 2003-261; s. 43, ch. 2004-390.
1626.551 Notice of change of address, name.—A licensee must notify the department, in writing, within 30 days after a change of name, residence address, principal business street address, mailing address, contact telephone numbers, including a business telephone number, or e-mail address. A licensee who has moved his or her principal place of residence and principal place of business from this state shall have his or her license and all appointments immediately terminated by the department. Failure to notify the department within the required time shall result in a fine not to exceed $250 for the first offense and a fine of at least $500 or suspension or revocation of the license pursuant to s. 626.611, s. 626.6115, s. 626.621, or s. 626.6215 for a subsequent offense. The department may adopt rules to administer and enforce this section.
History.—s. 234, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 201, 217, 807, 810, ch. 82-243; ss. 49, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 12, ch. 92-146; s. 231, ch. 97-102; s. 18, ch. 2002-206; s. 942, ch. 2003-261; s. 44, ch. 2004-390; s. 4, ch. 2008-237; s. 18, ch. 2012-209.
1Note.—Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
626.561 Reporting and accounting for funds.—
(1) All premiums, return premiums, or other funds belonging to insurers or others received by an agent, insurance agency, customer representative, or adjuster in transactions under the license are trust funds received by the licensee in a fiduciary capacity. An agent or insurance agency shall keep the funds belonging to each insurer for which an agent is not appointed, other than a surplus lines insurer, in a separate account so as to allow the department or office to properly audit such funds. The licensee in the applicable regular course of business shall account for and pay the same to the insurer, insured, or other person entitled thereto.
(2) The licensee shall keep and make available to the department or office books, accounts, and records as will enable the department or office to determine whether such licensee is complying with the provisions of this code. Every licensee shall preserve books, accounts, and records pertaining to a premium payment for at least 3 years after payment; provided, however, the preservation of records by computer or photographic reproductions or records in photographic form shall constitute compliance with this requirement. All other records shall be maintained in accordance with s. 626.748. The 3-year requirement shall not apply to insurance binders when no policy is ultimately issued and no premium is collected.
(3) Any agent, insurance agency, customer representative, or adjuster who, not being lawfully entitled thereto, either temporarily or permanently diverts or misappropriates such funds or any portion thereof or deprives the other person of a benefit therefrom commits the offense specified below:
(a) If the funds diverted or misappropriated are $300 or less, a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083.
(b) If the funds diverted or misappropriated are more than $300, but less than $20,000, a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(c) If the funds diverted or misappropriated are $20,000 or more, but less than $100,000, a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(d) If the funds diverted or misappropriated are $100,000 or more, a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
History.—s. 235, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 202, 217, 807, 810, ch. 82-243; ss. 50, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 3, ch. 95-340; s. 232, ch. 97-102; s. 25, ch. 98-199; s. 57, ch. 2002-206; s. 943, ch. 2003-261; s. 18, ch. 2005-257.
626.571 Delinquent agencies; notice of trusteeship.—If any agent or agency becomes delinquent for 90 days in payment of accounts owing to the insurer or insurers represented by the agent or agency, and a trusteeship or similar arrangement for the administration of the affairs of the agent or agency is instituted, the insurer or insurers involved therein shall immediately give written notice thereof to the department. The notice shall state the name and address of each such agent, the circumstances and estimated amount of delinquency, and such other information as the insurer deems pertinent or as the department may reasonably require.
History.—s. 236, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 217, 807, 810, ch. 82-243; ss. 51, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.5715 Parity of regulation of insurance agents and agencies.—The Insurance Code requirements apply equally to all insurance transactions as between an insurance agency owned by or an agent associated with a federally chartered financial institution, an insurance agency owned by or an agent associated with a state-chartered financial institution, and an insurance agency owned by or an agent associated with an entity that is not a financial institution. Except as provided in the code, one insurance agency or agent is not subject to more stringent or less stringent regulation than another insurance agency or agent on the basis of the regulatory status of the entity that owns the agency or is associated with the agent. For the purposes of this section, a person is “associated with” another entity if the person is employed by, retained by, under contract to, or owned or controlled by the entity directly or indirectly. This section does not apply with respect to a financial institution that is prohibited from owning an insurance agency or that is prohibited from being associated with an insurance agent under state or federal law.
History.—s. 5, ch. 96-168; s. 10, ch. 2001-142.
626.572 Rebating; when allowed.—
(1) No insurance agency agent shall rebate any portion of a commission except as follows:
(a) The rebate shall be available to all insureds in the same actuarial class.
(b) The rebate shall be in accordance with a rebating schedule filed by the agent with the insurer issuing the policy to which the rebate applies.
(c) The rebating schedule shall be uniformly applied in that all insureds who purchase the same policy through the agent for the same amount of insurance receive the same percentage rebate.
(d) Rebates shall not be given to an insured with respect to a policy purchased from an insurer that prohibits its agents from rebating commissions.
(e) The rebate schedule is prominently displayed in public view in the agent’s place of doing business and a copy is available to insureds on request at no charge.
(f) The age, sex, place of residence, race, nationality, ethnic origin, marital status, or occupation of the insured or location of the risk is not utilized in determining the percentage of the rebate or whether a rebate is available.
(2) The insurance agency agent shall maintain a copy of all rebate schedules for the most recent 5 years and their effective dates.
(3) No rebate shall be withheld or limited in amount based on factors which are unfairly discriminatory.
(4) No rebate shall be given which is not reflected on the rebate schedule.
(5) No rebate shall be refused or granted based upon the purchase or failure of the insured or applicant to purchase collateral business.
History.—ss. 52, 207, ch. 90-363; s. 4, ch. 91-429; s. 233, ch. 97-102; s. 19, ch. 2005-257.
626.581 Commissions contingent upon adjustment savings; prohibition.—
(1) It is unlawful for any insurer to enter into any agreement or understanding with its general or state agent or for any insurer, either directly or through its general or state agent, to enter into any agreement or understanding with any local resident agent of such insurer in this state, the effect of which is to make the net amount of any such agent’s commissions on policies of insurance negotiated and issued by such insurer in this state contingent upon savings effected in the adjustment, settlement, and payment of losses covered by such insurer’s policies, and in pursuance of which agreement or understanding the agent acts as adjuster for claims under such policies and pays claims incurred by such insurer under the policies from a stated percentage of the premiums collected or remitted to the agent thereon and retained by the agent; and any such agreements and understandings now existing are declared unlawful and shall be terminated immediately.
(2) Nothing in this section shall be construed to apply to or affect any contingent commissions agreement under which the general or state agent or local resident agent does not pay claims arising under policies of the insurer he or she represents from a stated percentage of premiums collected by him or her or remitted to such agent and retained by him or her.
History.—s. 237, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 217, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 234, ch. 97-102.
626.591 Penalty for violation of s. 626.581.—
(1) If any agent is found by the department to be in violation of s. 626.581, the department may, in its discretion, suspend or revoke the agent’s license. If any insurer is found by the office to be in violation of s. 626.581, the office may, in its discretion, suspend or revoke the insurer’s certificate of authority.
(2) Any such suspension or revocation shall be for a period of not less than 6 months, and the insurer or agent shall not subsequently be authorized or licensed to transact insurance unless the office or department is satisfied that the insurer or agent will not again violate any of the provisions of s. 626.581.
History.—s. 238, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 217, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 944, ch. 2003-261.
626.593 Insurance agent; written contract for compensation.—
(1) No person licensed as an insurance agent may receive any fee or commission or any other thing of value in addition to the rates filed pursuant to chapter 627 for examining any group health insurance or any group health benefit plan for the purpose of giving or offering advice, counsel, recommendation, or information in respect to terms, conditions, benefits, coverage, or premium of any such policy or contract unless such compensation is based upon a written contract signed by the party to be charged and specifying or clearly defining the amount or extent of such compensation and informing the party to be charged that any commission received from an insurer will be rebated to the party in accordance with subsection (3). In addition, all compensation to be paid to the insurance agent must be disclosed in the contract.
(2) A copy of every such contract shall be retained by the licensee for not less than 3 years after such services have been fully performed.
(3) Notwithstanding the provisions of s. 626.572, all commissions received by an insurance agent from an insurer in connection with the issuance of a policy, when a separate fee or other consideration has been paid to the insurance agent by an insured, shall be rebated to the insured or other party being charged within 30 days after receipt of such commission by the insurance agent.
(4) This section is subject to the unfair insurance trade practices provisions of s. 626.9541(1)(g).
History.—s. 37, ch. 2004-297.
626.601 Improper conduct; inquiry; fingerprinting.—
(1) The department or office may, upon its own motion or upon a written complaint signed by any interested person and filed with the department or office, inquire into any alleged improper conduct of any licensed insurance agency, agent, adjuster, service representative, managing general agent, customer representative, title insurance agent, title insurance agency, continuing education course provider, instructor, school official, or monitor group under this code. The department or office may thereafter initiate an investigation of any such licensee if it has reasonable cause to believe that the licensee has violated any provision of the insurance code. During the course of its investigation, the department or office shall contact the licensee being investigated unless it determines that contacting such person could jeopardize the successful completion of the investigation or cause injury to the public.
(2) In the investigation by the department or office of the alleged misconduct, the licensee shall, whenever so required by the department or office, cause his or her books and records to be open for inspection for the purpose of such inquiries.
(3) The complaints against any licensee may be informally alleged and need not be in any such language as is necessary to charge a crime on an indictment or information.
(4) The expense for any hearings or investigations under this law, as well as the fees and mileage of witnesses, may be paid out of the appropriate fund.
(5) If the department or office, after investigation, has reason to believe that a licensee may have been found guilty of or pleaded guilty or nolo contendere to a felony or a crime related to the business of insurance in this or any other state or jurisdiction, the department or office may require the licensee to file with the department or office a complete set of his or her fingerprints, which shall be accompanied by the fingerprint processing fee set forth in s. 624.501. The fingerprints shall be taken by an authorized law enforcement agency or other department-approved entity.
(6) The complaint and any information obtained pursuant to the investigation by the department or office are confidential and are exempt from the provisions of s. 119.07, unless the department or office files a formal administrative complaint, emergency order, or consent order against the licensee. Nothing in this subsection shall be construed to prevent the department or office from disclosing the complaint or such information as it deems necessary to conduct the investigation, to update the complainant as to the status and outcome of the complaint, or to share such information with any law enforcement agency.
History.—s. 239, ch. 59-205; ss. 13, 35, ch. 69-106; s. 11, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 203, 217, 807, 810, ch. 82-243; ss. 54, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 13, ch. 92-146; s. 372, ch. 96-406; s. 1725, ch. 97-102; s. 2, ch. 98-103; s. 27, ch. 98-199; s. 11, ch. 2001-142; s. 58, ch. 2002-206; s. 946, ch. 2003-261; s. 40, ch. 2003-267; s. 33, ch. 2003-281; s. 20, ch. 2005-257.
626.602 Insurance agency names; disapproval.—The department may disapprove the use of any true or fictitious name, other than the bona fide natural name of an individual, by any insurance agency on any of the following grounds:
(1) The name interferes with or is too similar to a name already filed and in use by another agency or insurer.
(2) The use of the name may mislead the public in any respect.
(3) The name states or implies that the agency is an insurer, motor club, hospital service plan, state or federal agency, charitable organization, or entity that primarily provides advice and counsel rather than sells or solicits insurance, or is entitled to engage in insurance activities not permitted under licenses held or applied for. This provision does not prohibit the use of the word “state” or “states” in the name of the agency. The use of the word “state” or “states” in the name of an agency does not in and of itself imply that the agency is a state agency.
History.—s. 21, ch. 2005-257.
626.611 Grounds for compulsory refusal, suspension, or revocation of agent’s, title agency’s, adjuster’s, customer representative’s, service representative’s, or managing general agent’s license or appointment.—The department shall deny an application for, suspend, revoke, or refuse to renew or continue the license or appointment of any applicant, agent, title agency, adjuster, customer representative, service representative, or managing general agent, and it shall suspend or revoke the eligibility to hold a license or appointment of any such person, if it finds that as to the applicant, licensee, or appointee any one or more of the following applicable grounds exist:
(1) Lack of one or more of the qualifications for the license or appointment as specified in this code.
(2) Material misstatement, misrepresentation, or fraud in obtaining the license or appointment or in attempting to obtain the license or appointment.
(3) Failure to pass to the satisfaction of the department any examination required under this code.
(4) If the license or appointment is willfully used, or to be used, to circumvent any of the requirements or prohibitions of this code.
(5) Willful misrepresentation of any insurance policy or annuity contract or willful deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising.
(6) If, as an adjuster, or agent licensed and appointed to adjust claims under this code, he or she has materially misrepresented to an insured or other interested party the terms and coverage of an insurance contract with intent and for the purpose of effecting settlement of claim for loss or damage or benefit under such contract on less favorable terms than those provided in and contemplated by the contract.
(7) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance.
(8) Demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or appointment.
(9) Fraudulent or dishonest practices in the conduct of business under the license or appointment.
(10) Misappropriation, conversion, or unlawful withholding of moneys belonging to insurers or insureds or beneficiaries or to others and received in conduct of business under the license or appointment.
(11) Unlawfully rebating, attempting to unlawfully rebate, or unlawfully dividing or offering to divide his or her commission with another.
(12) Having obtained or attempted to obtain, or having used or using, a license or appointment as agent or customer representative for the purpose of soliciting or handling “controlled business” as defined in s. 626.730 with respect to general lines agents, s. 626.784 with respect to life agents, and s. 626.830 with respect to health agents.
(13) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this code.
(14) Having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of the United States of America or of any state thereof or under the law of any other country which involves moral turpitude, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
(15) Fraudulent or dishonest practice in submitting or aiding or abetting any person in the submission of an application for workers’ compensation coverage under chapter 440 containing false or misleading information as to employee payroll or classification for the purpose of avoiding or reducing the amount of premium due for such coverage.
(16) Sale of an unregistered security that was required to be registered, pursuant to chapter 517.
(17) In transactions related to viatical settlement contracts as defined in s. 626.9911:
(a) Commission of a fraudulent or dishonest act.
(b) No longer meeting the requirements for initial licensure.
(c) Having received a fee, commission, or other valuable consideration for his or her services with respect to viatical settlements that involved unlicensed viatical settlement providers or persons who offered or attempted to negotiate on behalf of another person a viatical settlement contract as defined in s. 626.9911 and who were not licensed life agents.
(d) Dealing in bad faith with viators.
History.—s. 240, ch. 59-205; ss. 13, 35, ch. 69-106; s. 12, ch. 71-86; s. 160, ch. 73-333; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 204, 217, 807, 810, ch. 82-243; s. 28, ch. 82-386; s. 13, ch. 88-166; s. 49, ch. 90-201; ss. 55, 206, 207, ch. 90-363; s. 47, ch. 91-1; s. 4, ch. 91-429; s. 14, ch. 92-146; s. 10, ch. 92-318; s. 236, ch. 97-102; s. 28, ch. 98-199; s. 12, ch. 2001-142; s. 59, ch. 2002-206; s. 947, ch. 2003-261; s. 45, ch. 2004-390; s. 11, ch. 2005-237.
626.6115 Grounds for compulsory refusal, suspension, or revocation of insurance agency license.—The department shall deny, suspend, revoke, or refuse to continue the license of any insurance agency if it finds, as to any insurance agency or as to any majority owner, partner, manager, director, officer, or other person who manages or controls such agency, that any of the following applicable grounds exist:
(1) Lack by the agency of one or more of the qualifications for the license as specified in this code.
(2) Material misstatement, misrepresentation, or fraud in obtaining the license or in attempting to obtain the license.
(3) Denial, suspension, or revocation of a license to practice or conduct any regulated profession, business, or vocation relating to the business of insurance by this state, any other state, any nation, any possession or district of the United States, any court, or any lawful agency thereof. However, the existence of grounds for administrative action against a licensed agency does not constitute grounds for action against any other licensed agency, including an agency that owns, is under common ownership with, or is owned by, in whole or in part, the agency for which grounds for administrative action exist.
History.—ss. 205, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 22, ch. 2005-257.
626.621 Grounds for discretionary refusal, suspension, or revocation of agent’s, adjuster’s, customer representative’s, service representative’s, or managing general agent’s license or appointment.—The department may, in its discretion, deny an application for, suspend, revoke, or refuse to renew or continue the license or appointment of any applicant, agent, adjuster, customer representative, service representative, or managing general agent, and it may suspend or revoke the eligibility to hold a license or appointment of any such person, if it finds that as to the applicant, licensee, or appointee any one or more of the following applicable grounds exist under circumstances for which such denial, suspension, revocation, or refusal is not mandatory under s. 626.611:
(1) Any cause for which issuance of the license or appointment could have been refused had it then existed and been known to the department.
(2) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license or appointment.
(3) Violation of any lawful order or rule of the department, commission, or office.
(4) Failure or refusal, upon demand, to pay over to any insurer he or she represents or has represented any money coming into his or her hands belonging to the insurer.
(5) Violation of the provision against twisting, as defined in s. 626.9541(1)(l).
(6) In the conduct of business under the license or appointment, engaging in unfair methods of competition or in unfair or deceptive acts or practices, as prohibited under part IX of this chapter, or having otherwise shown himself or herself to be a source of injury or loss to the public.
(7) Willful overinsurance of any property or health insurance risk.
(8) Having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of the United States of America or of any state thereof or under the law of any other country, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
(9) If a life agent, violation of the code of ethics.
(10) Cheating on an examination required for licensure or violating test center or examination procedures published orally, in writing, or electronically at the test site by authorized representatives of the examination program administrator. Communication of test center and examination procedures must be clearly established and documented.
(11) Failure to inform the department in writing within 30 days after pleading guilty or nolo contendere to, or being convicted or found guilty of, any felony or a crime punishable by imprisonment of 1 year or more under the law of the United States or of any state thereof, or under the law of any other country without regard to whether a judgment of conviction has been entered by the court having jurisdiction of the case.
(12) Knowingly aiding, assisting, procuring, advising, or abetting any person in the violation of or to violate a provision of the insurance code or any order or rule of the department, commission, or office.
(13) Has been the subject of or has had a license, permit, appointment, registration, or other authority to conduct business subject to any decision, finding, injunction, suspension, prohibition, revocation, denial, judgment, final agency action, or administrative order by any court of competent jurisdiction, administrative law proceeding, state agency, federal agency, national securities, commodities, or option exchange, or national securities, commodities, or option association involving a violation of any federal or state securities or commodities law or any rule or regulation adopted thereunder, or a violation of any rule or regulation of any national securities, commodities, or options exchange or national securities, commodities, or options association.
(14) Failure to comply with any civil, criminal, or administrative action taken by the child support enforcement program under Title IV-D of the Social Security Act, 42 U.S.C. ss. 651 et seq., to determine paternity or to establish, modify, enforce, or collect support.
History.—s. 241, ch. 59-205; ss. 13, 35, ch. 69-106; s. 13, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 206, 217, 807, 810, ch. 82-243; s. 17, ch. 87-226; s. 14, ch. 88-166; s. 57, ch. 89-360; ss. 56, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 15, ch. 92-146; s. 237, ch. 97-102; s. 29, ch. 98-199; s. 46, ch. 2001-63; s. 60, ch. 2002-206; s. 948, ch. 2003-261; s. 46, ch. 2004-390; s. 24, ch. 2005-257; s. 47, ch. 2010-175; s. 19, ch. 2012-209.
626.6215 Grounds for discretionary refusal, suspension, or revocation of insurance agency license.—The department may, in its discretion, deny, suspend, revoke, or refuse to continue the license of any insurance agency if it finds, as to any insurance agency or as to any majority owner, partner, manager, director, officer, or other person who manages or controls such insurance agency, that any one or more of the following applicable grounds exist:
(1) Any cause for which issuance of the license could have been refused had it then existed and been known to the department.
(2) If the license is used, or to be used, to circumvent any of the requirements or prohibitions of this code.
(3) Having been found guilty of, or having pleaded guilty or nolo contendere to, a felony in this state or any other state relating to the business of insurance or an insurance agency, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
(4) Knowingly employing any individual in a managerial capacity or in a capacity dealing with the public who is under an order of revocation or suspension issued by the department.
(5) Committing any of the following acts with such frequency as to have made the operation of the agency hazardous to the insurance-buying public or other persons:
(a) Misappropriation, conversion, or unlawful withholding of moneys belonging to insurers or insureds or beneficiaries or to others and received in the conduct of business under the license.
(b) Unlawfully rebating, attempting to unlawfully rebate, or unlawfully dividing or offering to divide commissions with another.
(c) Misrepresentation of any insurance policy or annuity contract, or deception with regard to any such policy or contract, done either in person or by any form of dissemination of information or advertising.
(d) Violation of any provision of this code or of any other law applicable to the business of insurance in the course of dealing under the license.
(e) Violation of any lawful order or rule of the department.
(f) Failure or refusal, upon demand, to pay over to any insurer he or she represents or has represented any money coming into his or her hands belonging to the insurer.
(g) Violation of the provision against twisting as defined in s. 626.9541(1)(l).
(h) In the conduct of business under the license, engaging in unfair methods of competition or in unfair or deceptive acts or practices as prohibited under part IX of this chapter.
(i) Willful overinsurance of any property insurance risk.
(j) Fraudulent or dishonest practices in the conduct of business arising out of activities related to insurance or the insurance agency.
(k) Demonstrated lack of fitness or trustworthiness to engage in the business of insurance arising out of activities related to insurance or the insurance agency.
(6) Failure to take corrective action or report a violation to the department within 30 days after an individual licensee’s violation is known or should have been known by one or more of the partners, officers, or managers acting on behalf of the agency. However, the existence of grounds for administrative action against a licensed agency does not constitute grounds for action against any other licensed agency, including an agency that owns, is under common ownership with, or is owned by, in whole or in part, the agency for which grounds for administrative action exist.
History.—ss. 207, 807, ch. 82-243; s. 88, ch. 83-216; s. 18, ch. 87-226; ss. 57, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 238, ch. 97-102; s. 47, ch. 2001-63; s. 23, ch. 2005-257.
626.631 Procedure for refusal, suspension, or revocation of license.—
(1) If any licensee is convicted by a court of a violation of this code or a felony, the licenses and appointments of such person shall be immediately revoked by the department. The licensee may subsequently request a hearing pursuant to ss. 120.569 and 120.57, and the department shall expedite any such requested hearing. The sole issue at such hearing shall be whether the revocation should be rescinded because such person was not in fact convicted of a violation of this code or a felony.
(2) The papers, documents, reports, or evidence of the department relative to a hearing for revocation or suspension of a license or appointment pursuant to the provisions of this chapter and chapter 120 are confidential and exempt from the provisions of s. 119.07(1) until after the same have been published at the hearing. However, such papers, documents, reports, or items of evidence are subject to discovery in a hearing for revocation or suspension of a license or appointment.
History.—s. 242, ch. 59-205; ss. 13, 35, ch. 69-106; s. 14, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 208, 217, 807, 810, ch. 82-243; ss. 58, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 16, ch. 92-146; s. 5, ch. 93-80; s. 373, ch. 96-406; s. 269, ch. 96-410; s. 949, ch. 2003-261; s. 47, ch. 2004-390.
626.641 Duration of suspension or revocation.—
(1) The department shall, in its order suspending a license or appointment or in its order suspending the eligibility of a person to hold or apply for such license or appointment, specify the period during which the suspension is to be in effect; but such period shall not exceed 2 years. The license, appointment, or eligibility shall remain suspended during the period so specified, subject, however, to any rescission or modification of the order by the department, or modification or reversal thereof by the court, prior to expiration of the suspension period. A license, appointment, or eligibility that has been suspended shall not be reinstated except upon the filing and approval of an application for reinstatement and, in the case of a second suspension, completion of continuing education courses prescribed and approved by the department; but the department shall not approve an application for reinstatement if it finds that the circumstance or circumstances for which the license, appointment, or eligibility was suspended still exist or are likely to recur. In addition, an application for reinstatement is subject to denial and subject to a waiting period prior to approval on the same grounds that apply to applications for licensure pursuant to ss. 626.207, 626.611, 626.621, and 626.8698.
(2) No person or appointee under any license or appointment revoked by the department, nor any person whose eligibility to hold same has been revoked by the department, shall have the right to apply for another license or appointment under this code within 2 years from the effective date of such revocation or, if judicial review of such revocation is sought, within 2 years from the date of final court order or decree affirming the revocation. An applicant for another license or appointment pursuant to this subsection must apply and qualify for licensure in the same manner as a first-time applicant, and the application may be denied on the same grounds that apply to first-time applicants for licensure pursuant to ss. 626.207, 626.611, and 626.621. In addition, the department shall not grant a new license or appointment or reinstate eligibility to hold such license or appointment if it finds that the circumstance or circumstances for which the eligibility was revoked or for which the previous license or appointment was revoked still exist or are likely to recur; if an individual’s license as agent or customer representative or eligibility to hold same has been revoked upon the ground specified in s. 626.611(12), the department shall refuse to grant or issue any new license or appointment so applied for.
(3)(a) If any of an individual’s licenses as an agent or customer representative or the eligibility to hold such license or licenses has been revoked at two separate times, the department may not thereafter grant or issue any license under this code to such individual.
(b) If a license as an agent or customer representative or the eligibility to hold such a license has been revoked resulting from the solicitation or sale of an insurance product to a person 65 years of age or older, the department may not thereafter grant or issue any license under this code to such individual.
(4) During the period of suspension or revocation of a license or appointment, and until the license is reinstated or, if revoked, a new license issued, the former licensee or appointee may not engage in or attempt or profess to engage in any transaction or business for which a license or appointment is required under this code or directly or indirectly own, control, or be employed in any manner by an agent, agency, adjuster, or adjusting firm.
History.—s. 243, ch. 59-205; ss. 13, 35, ch. 69-106; s. 15, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 209, 217, 807, 810, ch. 82-243; ss. 55, 58, ch. 89-360; ss. 59, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 17, ch. 92-146; s. 30, ch. 98-199; s. 61, ch. 2002-206; s. 950, ch. 2003-261; s. 44, ch. 2004-374; s. 48, ch. 2004-390; s. 118, ch. 2005-2; s. 25, ch. 2005-257; s. 9, ch. 2008-220; s. 48, ch. 2010-175; s. 20, ch. 2012-209.
626.651 Effect of suspension, revocation upon associated licenses and appointments and licensees and appointees.—
(1) Upon suspension, revocation, or refusal to renew or continue any one license of a licensee, or upon suspension or revocation of eligibility to hold a license or appointment, the department shall at the same time likewise suspend or revoke all other licenses, appointments, or status of eligibility held by the licensee or appointee under this code.
(2) In case of the suspension or revocation of license and appointments of any general lines agent, or in case of suspension or revocation of eligibility, the license and appointments of any other agents who are members of such agency, whether incorporated or unincorporated, and any customer representatives employed by such agency, who knowingly are parties to the act which formed the ground for the suspension or revocation may likewise be suspended or revoked.
History.—s. 244, ch. 59-205; ss. 13, 35, ch. 69-106; s. 16, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 210, 217, 807, 810, ch. 82-243; ss. 60, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 31, ch. 98-199; s. 62, ch. 2002-206; s. 21, ch. 2012-209.
626.6515 Effect of suspension or revocation upon associated agencies.—Upon suspension or revocation of the license of an insurance agency, the department may at the same time revoke, suspend, or refuse to continue the license of any other insurance agency under the management, ownership, control, or directorship of any person or persons who participated in activities which resulted in the suspension, revocation, or refusal to continue the initial license if acts occurred at that specific agency location which are grounds for refusal, suspension, or revocation of a license under this code. The department shall not, during the period of revocation or suspension, grant any new license for the establishment of any additional agency not in operation at the time of suspension, revocation, or refusal to any agency under or proposed to be under substantially the same management, ownership, control, or directorship of individuals who directed or participated in activities which resulted in suspension, revocation, or refusal of an agency license.
History.—ss. 211, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.661 Surrender of license.—
(1) Though issued to a licensee, all licenses issued under this chapter are at all times the property of the State of Florida; and, upon notice of any suspension, revocation, refusal to renew, failure to renew, expiration, or other termination of the license, such license shall no longer be in force and effect.
(2) This section shall not be deemed to require the surrender to the department of any license unless such surrender has been requested by the department.
History.—s. 245, ch. 59-205; s. 2, ch. 61-105; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 212, 217, 807, 810, ch. 82-243; ss. 61, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 951, ch. 2003-261; s. 49, ch. 2004-390.
626.681 Administrative fine in lieu of or in addition to suspension, revocation, or refusal of license, appointment, or disapproval.—
(1) Except as to insurance agencies, if the department finds that one or more grounds exist for the suspension, revocation, or refusal to issue, renew, or continue any license or appointment issued under this chapter, or disapproval of a continuing education course provider, instructor, school official, or monitor groups, the department may, in its discretion, in lieu of or in addition to such suspension or revocation, or in lieu of such refusal, or disapproval, and except on a second offense or when such suspension, revocation, or refusal is mandatory, impose upon the licensee, appointee, course provider, instructor, school official, or monitor group an administrative penalty in an amount up to $500 or, if the department has found willful misconduct or willful violation on the part of the licensee, appointee, course provider, instructor, school official, or monitor group up to $3,500. The administrative penalty may, in the discretion of the department, be augmented by an amount equal to any commissions received by or accruing to the credit of the licensee or appointee in connection with any transaction as to which the grounds for suspension, revocation, or refusal related.
(2) With respect to insurance agencies, if the department finds that one or more grounds exist for the suspension, revocation, or refusal to issue, renew, or continue any license issued under this chapter, the department may, in its discretion, in lieu of or in addition to such suspension or revocation, or in lieu of such refusal, impose upon the licensee an administrative penalty in an amount not to exceed $10,000 per violation. The administrative penalty may, in the discretion of the department, be augmented by an amount equal to any commissions received by or accruing to the credit of the licensee in connection with any transaction as to which the grounds for suspension, revocation, or refusal related.
(3) The department may allow the licensee, appointee, or continuing education course provider, instructor, school official, or monitor group a reasonable period, not to exceed 30 days, within which to pay to the department the amount of the penalty so imposed. If the licensee, appointee, course provider, instructor, school official, or monitor group fails to pay the penalty in its entirety to the department within the period so allowed, the license, appointments, approval, or status of that person shall stand suspended or revoked or issuance, renewal, or continuation shall be refused, as the case may be, upon expiration of such period.
History.—s. 247, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 214, 217, 807, 810, ch. 82-243; ss. 62, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 3, ch. 98-103; s. 32, ch. 98-199; s. 952, ch. 2003-261; s. 50, ch. 2004-390.
626.691 Probation.—
(1) If the department finds that one or more grounds exist for the suspension, revocation, or refusal to renew or continue any license or appointment issued under this part, the department may, in its discretion, except when an administrative fine is not permissible under s. 626.681 or when such suspension, revocation, or refusal is mandatory, in lieu of or in addition to such suspension or revocation, or in lieu of such refusal, or in connection with any administrative monetary penalty imposed under s. 626.681, place the offending licensee or appointee on probation for a period, not to exceed 2 years, as specified by the department in its order.
(2) As a condition to such probation or in connection therewith, the department may specify in its order reasonable terms and conditions to be fulfilled by the probationer during the probation period. If during the probation period the department has good cause to believe that the probationer has violated a term or condition, it shall suspend, revoke, or refuse to issue, renew, or continue the license or appointment of the probationer, as upon the original grounds referred to in subsection (1).
History.—s. 248, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 215, 217, 807, 810, ch. 82-243; ss. 63, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 33, ch. 98-199; s. 953, ch. 2003-261; s. 51, ch. 2004-390.
626.692 Restitution.—If any ground exists for the suspension, revocation, or refusal of a license or appointment, the department may, in addition to any other penalty authorized under this chapter, order the licensee to pay restitution to any person who has been deprived of money by the licensee’s misappropriation, conversion, or unlawful withholding of moneys belonging to insurers, insureds, beneficiaries, or others. In no instance shall the amount of restitution required to be paid under this section exceed the amount of money misappropriated, converted, or unlawfully withheld. Nothing in this section limits or restricts a person’s right to seek other remedies as provided for by law.
History.—s. 34, ch. 98-199; s. 954, ch. 2003-261; s. 52, ch. 2004-390.
626.711 Retaliatory provision, agents.—When under the laws of any other state any fine, tax, penalty, license fee, deposit of money, or security, or other obligation or prohibition is imposed upon resident insurance agents of this state doing business in such other state, then so long as such laws continue in force or are so administered, the same requirements, obligations, and prohibitions, of whatever kind, shall be imposed upon every insurance agent of such other state doing business in this state.
History.—s. 250, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 216, 217, 807, 810, ch. 82-243; ss. 205, 206, 207, ch. 90-363; s. 4, ch. 91-429.
PART II
GENERAL LINES AGENTS626.726 Short title.
626.727 Scope of this part.
626.728 This part supplements licensing law.
626.729 “Industrial fire insurance” defined.
626.730 Purpose of license.
626.731 Qualifications for general lines agent’s license.
626.7315 Prohibition against the unlicensed transaction of general lines insurance.
626.732 Requirement as to knowledge, experience, or instruction.
626.733 Agency firms and corporations; special requirements.
626.734 Corporations, liability of agent.
626.7351 Qualifications for customer representative’s license.
626.7352 Customer representative’s office.
626.7353 Appointment of customer representatives.
626.7354 Customer representative’s powers; agent’s or agency’s responsibility.
626.7355 Temporary license as customer representative pending examination.
626.741 Nonresident agents; licensing and restrictions.
626.742 Nonresident agents; service of process.
626.743 Nonresident agents; retaliatory provision.
626.744 Service representatives, managing general agents; application for license.
626.745 Service representatives, managing general agents; managers; activities.
626.7451 Managing general agents; required contract provisions.
626.7452 Managing general agents; examination authority.
626.7453 Managing general agents; errors and omissions insurance.
626.7454 Managing general agents; duties of insurers.
626.7455 Managing general agent; responsibility of insurer.
626.747 Branch agencies.
626.748 Agent’s records.
626.749 Place of business in residence.
626.7491 Business transacted with producer controlled property and casualty insurer.
626.7492 Reinsurance intermediaries.
626.752 Exchange of business.
626.753 Sharing commissions; penalty.
626.754 Rights of agent following termination of appointment.
626.726 Short title.—This part may be referred to in any legal proceedings as the “General Lines Agents Law.”
History.—s. 252, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 241, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.727 Scope of this part.—This part applies only to general lines agents, customer representatives, service representatives, and managing general agents, all as defined in s. 626.015. Provisions of this part which apply to general lines agents and applicants also apply to personal lines agents and applicants, except where otherwise provided.
History.—s. 251, ch. 59-205; s. 17, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 241, 807, 810, ch. 82-243; ss. 64, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 35, ch. 98-199; ss. 19, 72, ch. 2002-206; s. 20, ch. 2004-374.
626.728 This part supplements licensing law.—This part is supplementary to part I of this chapter of the code, the “Licensing Procedures Law.”
History.—s. 253, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 241, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.729 “Industrial fire insurance” defined.—For the purposes of this code, “industrial fire insurance” is insurance against loss by fire of either buildings and other structures or contents, which may include extended coverage; windstorm insurance; basic limits owner’s, landlord’s, or tenant’s liability insurance with single limits of $25,000; comprehensive personal liability insurance with a single limit of $25,000; or burglary insurance, under which the premiums are collected quarterly or more often and the face amount of the insurance provided by the policy on one risk is not more than $50,000, including the contents of such buildings and other structures, and the insurer issuing such policy is operating under a system of collecting a debit by its agents. A temporary license for an industrial fire or burglary agent issued pursuant to s. 626.175 shall be solely for the purpose of collecting premiums and servicing in-force policies, and such licensee shall not directly or indirectly solicit, negotiate, or effect contracts of insurance.
History.—s. 254, ch. 59-205; s. 1, ch. 67-327; s. 1, ch. 73-118; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 1, 2, ch. 80-93; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 218, 241, 807, 810, ch. 82-243; s. 1, ch. 88-41; ss. 65, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 2, ch. 96-362; s. 20, ch. 2002-206.
626.730 Purpose of license.—
(1) The purpose of a license issued under this code to a general lines agent or customer representative is to authorize and enable the licensee actively and in good faith to engage in the insurance business as such an agent or customer representative with respect to the public and to facilitate the public supervision of such activities in the public interest, and not for the purpose of enabling the licensee to receive a rebate of premium in the form of commission or other compensation as an agent or customer representative or enabling the licensee to receive commissions or other compensation based upon insurance solicited or procured by or through him or her upon his or her own interests or those of other persons with whom he or she is closely associated in capacities other than that of insurance agent or customer representative.
(2) The department shall not grant, renew, continue, or permit to exist any license or appointment as such agent or customer representative as to any applicant therefor or licensee or appointee thereunder if it finds that the license or appointment has been, is being, or will probably be used by the applicant, licensee, or appointee for the purpose of securing rebates or commissions on “controlled business,” that is, on insurance written on his or her own interests or those of his or her family or of any firm, corporation, or association with which he or she is associated, directly or indirectly, or in which he or she has an interest other than as to the insurance thereof.
(3) A violation of this section shall be deemed to exist or be probable (as to an applicant for appointment) if the department finds that during any 12-month period aggregate commissions or other compensation accruing in favor of the applicant or licensee or appointee based upon the insurance procured or to be procured (in the case of an applicant for appointment) by or through the licensee or appointee with respect to insurance of his or her own interests or those of his or her family or of any firm, corporation, or association with which he or she is associated or in which he or she is interested, as referred to in subsection (2), have exceeded or will exceed 50 percent of the aggregate amount of commissions and compensation accruing or to accrue in his or her favor during the same period as to all insurance coverages procured or to be procured by or through him or her. Except, any general lines agent who, on July 1, 1959, had aggregate commissions or other compensation on controlled business as defined in this section in excess of the aforesaid 50 percent shall be permitted to continue writing such insurance for the same insured or insureds, so long as the agent continues to hold a general lines agent’s license and appointment in good standing to transact the same kinds of insurance so written, until the termination of such license or appointment by failure to renew or continue, suspension, or revocation.
(4) This section does not prohibit a licensee holding a limited license for credit insurance or motor vehicle physical damage and mechanical breakdown insurance from being employed by or associated with a motor vehicle sales or financing agency, a retail sales establishment, or a consumer loan office for the purpose of insuring the interest of such entity in a motor vehicle sold or financed by it or in personal property if used as collateral for a loan.
(5) This section does not apply to the interest of a real estate mortgagee in or as to insurance covering such interest or in the real estate subject to such mortgage.
History.—s. 255, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 1, ch. 80-133; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 219, 241, 807, 810, ch. 82-243; ss. 66, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 239, ch. 97-102; s. 36, ch. 98-199; s. 22, ch. 99-3; s. 6, ch. 99-388; ss. 21, 63, ch. 2002-206; s. 42, ch. 2011-194; s. 22, ch. 2012-209.
626.731 Qualifications for general lines agent’s license.—
(1) The department shall not grant or issue a license as general lines agent to any individual found by it to be untrustworthy or incompetent or who does not meet each of the following qualifications:
(a) The applicant is a natural person at least 18 years of age.
(b) The applicant is a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and is a bona fide resident of this state. An individual who is a bona fide resident of this state shall be deemed to meet the residence requirement of this paragraph, notwithstanding the existence at the time of application for license of a license in his or her name on the records of another state as a resident licensee of such other state, if the applicant furnishes a letter of clearance satisfactory to the department that the resident licenses have been canceled or changed to a nonresident basis and that he or she is in good standing.
(c) The applicant’s place of business will be located in this state and he or she will be actively engaged in the business of insurance and will maintain a place of business, the location of which is identifiable by and accessible to the public.
(d) The license is not being sought for the purpose of writing or handling controlled business, in violation of s. 626.730.
(e) The applicant is qualified as to knowledge, experience, or instruction in the business of insurance and meets the requirements provided in s. 626.732.
(f) The applicant is not a service representative, a managing general agent in this state, or a special agent or similar service representative of a health insurer which also transacts property, casualty, or surety insurance; except that the president, vice president, secretary, or treasurer, including a member of the board of directors, of a corporate insurer, if otherwise qualified under and meeting the requirements of this part, may be licensed and appointed as a local resident agent.
(g) The applicant has passed any required examination for license required under s. 626.221.
(2) The department shall not grant, continue, renew, or permit to exist the license or appointment of a general lines agent unless the agent meets the requirements of subsection (1).
History.—s. 256, ch. 59-205; ss. 13, 35, ch. 69-106; s. 1, ch. 75-303; s. 3, ch. 76-168; s. 1, ch. 77-116; s. 52, ch. 77-121; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 220, 241, 807, 810, ch. 82-243; s. 29, ch. 82-386; s. 9, ch. 83-288; s. 15, ch. 88-166; ss. 67, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 240, ch. 97-102; s. 41, ch. 2003-267; s. 34, ch. 2003-281; s. 108, ch. 2004-5; s. 2, ch. 2005-195.
626.7315 Prohibition against the unlicensed transaction of general lines insurance.—With respect to any line of authority as defined in s. 626.015(5), no individual shall, unless licensed as a general lines agent:
(1) Solicit insurance or procure applications therefor;
(2) In this state, receive or issue a receipt for any money on account of or for any insurer, or receive or issue a receipt for money from other persons to be transmitted to any insurer for a policy, contract, or certificate of insurance or any renewal thereof, even though the policy, certificate, or contract is not signed by him or her as agent or representative of the insurer, except as provided in s. 626.0428(1);
(3) Directly or indirectly represent himself or herself to be an agent of any insurer or as an agent, to collect or forward any insurance premium, or to solicit, negotiate, effect, procure, receive, deliver, or forward, directly or indirectly, any insurance contract or renewal thereof or any endorsement relating to an insurance contract, or attempt to effect the same, of property or insurable business activities or interests, located in this state;
(4) In this state, engage or hold himself or herself out as engaging in the business of analyzing or abstracting insurance policies or of counseling or advising or giving opinions, other than as a licensed attorney at law, relative to insurance or insurance contracts, for fee, commission, or other compensation, other than as a salaried bona fide full-time employee so counseling and advising his or her employer relative to the insurance interests of the employer and of the subsidiaries or business affiliates of the employer;
(5) In any way, directly or indirectly, make or cause to be made, or attempt to make or cause to be made, any contract of insurance for or on account of any insurer;
(6) Solicit, negotiate, or in any way, directly or indirectly, effect insurance contracts, if a member of a partnership or association, or a stockholder, officer, or agent of a corporation which holds an agency appointment from any insurer; or
(7) Receive or transmit applications for suretyship, or receive for delivery bonds founded on applications forwarded from this state, or otherwise procure suretyship to be effected by a surety insurer upon the bonds of persons in this state or upon bonds given to persons in this state.
History.—s. 22, ch. 2002-206; s. 955, ch. 2003-261; s. 42, ch. 2003-267; s. 35, ch. 2003-281; s. 109, ch. 2004-5.
626.732 Requirement as to knowledge, experience, or instruction.—
(1) Except as provided in subsection (4), an applicant for a license as a general lines agent, except for a chartered property and casualty underwriter (CPCU), may not be qualified or licensed unless, within the 4 years immediately preceding the date the application for license is filed with the department, the applicant has:
(a) Taught or successfully completed classroom courses in insurance, 3 hours of which must be on the subject matter of ethics, at a school, college, or extension division thereof, approved by the department;
(b) Completed a correspondence course in insurance, 3 hours of which must be on the subject matter of ethics, which is regularly offered by accredited institutions of higher learning in this state or extensions thereof and approved by the department, and have at least 6 months of responsible insurance duties as a substantially full-time bona fide employee in all lines of property and casualty insurance set forth in the definition of general lines agent under s. 626.015;
(c) Completed at least 1 year in responsible insurance duties as a substantially full-time bona fide employee in all lines of property and casualty insurance as set forth in the definition of a general lines agent under s. 626.015, but without the education requirement described in paragraph (a) or paragraph (b);
(d) Completed at least 1 year of responsible insurance duties as a licensed and appointed customer representative or limited customer representative in commercial or personal lines of property and casualty insurance and 40 hours of classroom courses approved by the department covering the areas of property, casualty, surety, health, and marine insurance; or
(e) Completed at least 1 year of responsible insurance duties as a licensed and appointed service representative in commercial or personal lines of property and casualty insurance and 80 hours of classroom courses approved by the department covering the areas of property, casualty, surety, health, and marine insurance.
(2) Except as provided under subsection (4), an applicant for a license as a personal lines agent, except for a chartered property and casualty underwriter (CPCU), may not be qualified or licensed unless, within the 4 years immediately preceding the date the application for license is filed with the department, the applicant has:
(a) Taught or successfully completed classroom courses in insurance, 3 hours of which must be on the subject matter of ethics, at a school, college, or extension division thereof, approved by the department. To qualify for licensure, the applicant must complete a total of 52 hours of classroom courses in insurance;
(b) Completed a correspondence course in insurance, 3 hours of which must be on the subject matter of ethics, which is regularly offered by accredited institutions of higher learning in this state or extensions thereof and approved by the department, and completed at least 3 months of responsible insurance duties as a substantially full-time employee in the area of property and casualty insurance sold to individuals and families for noncommercial purposes;
(c) Completed at least 6 months of responsible insurance duties as a substantially full-time employee in the area of property and casualty insurance sold to individuals and families for noncommercial purposes, but without the education requirement described in paragraph (a) or paragraph (b);
(d) Completed at least 6 months of responsible duties as a licensed and appointed customer representative or limited customer representative in property and casualty insurance sold to individuals and families for noncommercial purposes and 20 hours of classroom courses approved by the department which are related to property and casualty insurance sold to individuals and families for noncommercial purposes;
(e) Completed at least 6 months of responsible insurance duties as a licensed and appointed service representative in property and casualty insurance sold to individuals and families for noncommercial purposes and 40 hours of classroom courses approved by the department related to property and casualty insurance sold to individuals and families for noncommercial purposes; or
(f) Completed at least 3 years of responsible duties as a licensed and appointed customer representative in property and casualty insurance sold to individuals and families for noncommercial purposes.
(3) If an applicant’s qualifications as required under subsection (1) or subsection (2) are based in part upon periods of employment in responsible insurance duties, the applicant shall submit with the license application, on a form prescribed by the department, an affidavit of his or her employer setting forth the period of such employment, that the employment was substantially full-time, and giving a brief abstract of the nature of the duties performed by the applicant.
(4) An individual who was or became qualified to sit for an agent’s, customer representative’s, or adjuster’s examination at or during the time he or she was employed by the department or office and who, while so employed, was employed in responsible insurance duties as a full-time bona fide employee may take an examination if application for such examination is made within 90 days after the date of termination of employment with the department or office.
(5) Classroom and correspondence courses under subsections (1) and (2) must include instruction on the subject matter of unauthorized entities engaging in the business of insurance. The scope of the topic of unauthorized entities must include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as it relates to the provision of health insurance by employers and the regulation thereof.
(6) This section does not apply to an individual holding only a limited license for travel insurance, motor vehicle rental insurance, credit insurance, in-transit and storage personal property insurance, or portable electronics insurance.
History.—s. 257, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 221(1st), 241, 807, 810, ch. 82-243; s. 16, ch. 88-166; ss. 68, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 241, ch. 97-102; s. 37, ch. 98-199; s. 3, ch. 2002-84; s. 23, ch. 2002-206; s. 956, ch. 2003-261; s. 43, ch. 2003-267; s. 36, ch. 2003-281; s. 21, ch. 2004-374; s. 23, ch. 2012-209.
626.733 Agency firms and corporations; special requirements.—If a sole proprietorship, partnership, corporation, or association holds an agency contract, all members thereof who solicit, negotiate, or effect insurance contracts, and all officers and stockholders of the corporation who solicit, negotiate, or effect insurance contracts, are required to qualify and be licensed individually as agents or customer representatives; and all of such agents must be individually appointed as to each property and casualty insurer entering into an agency contract with such agency. Each such appointing insurer as soon as known to it shall comply with this section and shall determine and require that each agent so associated in or so connected with such agency is likewise appointed as to the same such insurer and for the same type and class of license. However, no insurer is required to comply with the provisions of this section if such insurer satisfactorily demonstrates to the department that the insurer has issued an aggregate net written premium, in an agency, in an amount of $25,000 or less.
History.—s. 258, ch. 59-205; s. 18, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 222(1st), 241, 807, 810, ch. 82-243; s. 30, ch. 82-386; s. 4, ch. 83-157; ss. 69, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 38, ch. 98-199; s. 82, ch. 2003-1; s. 44, ch. 2003-267; s. 37, ch. 2003-281.
626.734 Corporations, liability of agent.—Any general lines insurance agent who is an officer, director, or stockholder of an incorporated general lines insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provisions of this code committed by such licensee or by any person under his or her direct supervision and control while acting on behalf of the corporation. Nothing in this section shall be construed to render any person criminally liable or subject to any disciplinary proceedings for any act unless such person personally committed or knew or should have known of such act and of the facts constituting a violation of this chapter.
History.—s. 4, ch. 63-20; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 241, 807, 810, ch. 82-243; ss. 70, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 242, ch. 97-102.
626.7351 Qualifications for customer representative’s license.—The department shall not grant or issue a license as customer representative to any individual found by it to be untrustworthy or incompetent, or who does not meet each of the following qualifications:
(1) The applicant is a natural person at least 18 years of age.
(2)(a) The applicant is a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and is a bona fide resident of this state and will actually reside in the state at least 6 months out of the year. An individual who is a bona fide resident of this state shall be deemed to meet the residence requirements of this subsection, notwithstanding the existence at the time of application for license of a license in his or her name on the records of another state as a resident licensee of the other state, if the applicant furnishes a letter of clearance satisfactory to the department that the resident licenses have been canceled or changed to a nonresident basis and that he or she is in good standing.
(b) The applicant is a resident of another state sharing a common boundary with this state and has been employed in this state for a period of not less than 6 months by a Florida resident general lines agent licensed and appointed under this chapter. The applicant licensed under this subsection must meet all other requirements as described in this chapter and must, under the direct supervision of a licensed and appointed Florida resident general lines agent, conduct business solely within the confines of the office of the agent or agency whom he or she represents in this state.
(3) Within the 2 years next preceding the date the application for license was filed with the department, the applicant has completed a course in insurance, 3 hours of which shall be on the subject matter of ethics, approved by the department or has had at least 6 months’ experience in responsible insurance duties as a substantially full-time employee. Courses must include instruction on the subject matter of unauthorized entities engaging in the business of insurance. The scope of the topic of unauthorized entities shall include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as such acts relate to the provision of health insurance by employers and the regulation of such insurance.
(4) The license is not being sought for the purpose of writing or handling controlled business in violation of s. 626.730.
(5) The applicant will be employed by only one agent or agency and the agency will appoint one designated agent within the agency who will supervise the work of the applicant and his or her conduct in the insurance business, and the applicant will spend all of his or her business time in the employment of the agent or agency and will be domiciled in the office of the appointing agent or agency as provided in s. 626.7352.
(6) Upon the issuance of the license applied for, the applicant is not an agent, a service representative, or a managing general agent.
(7) The applicant has passed any required examination for license required under s. 626.221.
History.—ss. 71, 207, ch. 90-363; s. 4, ch. 91-429; s. 18, ch. 92-146; s. 243, ch. 97-102; s. 39, ch. 98-199; s. 45, ch. 2003-267; s. 38, ch. 2003-281; s. 110, ch. 2004-5; s. 26, ch. 2005-257.
626.7352 Customer representative’s office.—A customer representative shall be housed wholly and completely within the actual confines of the office of the agent or agency whom he or she represents, together with any such furniture, books, records, equipment, and paraphernalia necessary for the conduct of such insurance business. The customer representative shall not maintain any such office or furniture, books, records, equipment, or paraphernalia at any other address or location, nor shall he or she maintain or make use of any other quarters, space, or address, for the purpose of the conduct of such business. No advertising, letterhead, or telephone listing of the customer representative shall indicate any business address other than that of the agent or agency by whom he or she is employed. No customer representative may be employed from any location except where an agent licensed to write such lines spends his or her full time in charge of such location.
History.—ss. 72, 207, ch. 90-363; s. 4, ch. 91-429; s. 19, ch. 92-146; s. 244, ch. 97-102.
626.7353 Appointment of customer representatives.—
(1) Any person duly licensed and appointed as a general lines agent, except a person holding a limited license provided for in s. 626.321, and any general lines insurance agency may appoint as customer representatives any persons who hold or have qualified for a customer representative’s license.
(2) The same individual shall not be appointed as customer representative as to more than one appointing agent or agency at any one time, and the general lines agent designated pursuant to s. 626.7351(5) to supervise the work of the customer representative shall sign the appointment form, obligating himself or herself to supervise the customer representative’s conduct and business.
(3) The department shall prescribe by rule forms to administer this section.
History.—ss. 73, 207, ch. 90-363; s. 4, ch. 91-429; s. 20, ch. 92-146; s. 245, ch. 97-102; s. 7, ch. 2000-370.
626.7354 Customer representative’s powers; agent’s or agency’s responsibility.—
(1) A customer representative’s license shall not cover life insurance or any kind of insurance for which the agent or agency by which he or she is appointed is not then licensed.
(2) A customer representative may engage in transacting insurance with customers who have been solicited by any agent or customer representative in the same agency, and may engage in transacting insurance with customers who have not been so solicited to the extent and under conditions that are otherwise consistent with this part and with the insurer’s contract with the agent appointing him or her.
(3) A customer representative shall be a salaried employee of the agent or agency. His or her compensation shall not include commissions and shall not be primarily based on the production of applications, insurance, or premiums.
(4) A customer representative shall not engage in transacting insurance outside of the office of his or her agent or agency.
(5) All business transacted by a customer representative under his or her license shall be in the name of the agent or agency by which he or she is appointed, and the agent or agency shall be responsible and accountable for all acts of the customer representative within the scope of such appointment.
History.—ss. 74, 207, ch. 90-363; s. 4, ch. 91-429; s. 246, ch. 97-102; s. 83, ch. 2003-1; s. 46, ch. 2003-267; s. 39, ch. 2003-281.
626.7355 Temporary license as customer representative pending examination.—
(1) The department shall issue a temporary customer representative’s license with respect to a person who has applied for such license upon finding that the person:
(a) Has filed an application for a customer representative’s license or a limited customer representative’s license and has paid any fees required under s. 624.501(5) in connection with such application for a customer representative’s license or limited customer representative’s license.
(b) Is a natural person at least 18 years of age.
(c) Is a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and is a bona fide resident of this state or is a resident of another state sharing a common boundary with this state. An individual who is a bona fide resident of this state shall be deemed to meet the residence requirement of this paragraph, notwithstanding the existence at the time of application for license, of a license in his or her name on the records of another state as a resident licensee of such other state, if the applicant furnishes a letter of clearance satisfactory to the department that his or her resident licenses have been canceled or changed to a nonresident basis and that he or she is in good standing.
(d) Has such business reputation as would reasonably assure that the applicant will conduct his or her business as a temporary customer representative fairly and in good faith and without detriment to the public.
(e) Is employed at the time of application for license, and at all times throughout the existence of the temporary license, by only one general lines agency or licensed general lines agent.
(f) Is supervised by one licensed and appointed general lines agent who will oversee the work of the applicant and be responsible for the applicant’s acts under this section. Any individual who is currently serving an administrative probation imposed by the department shall not be permitted to act as the designated supervising general lines agent to supervise the activities of a temporary licensee.
(g) Within the last 5 years, has not been convicted, found guilty or pleaded nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of any municipality, county, state, territory, or country, whether or not a judgment of conviction has been entered.
(h) Is not the subject of pending criminal, administrative, or civil charges in any state or federal court anywhere in the United States or its possessions or any other country.
(i) Is not the subject of pending criminal probation for a felony crime or any misdemeanor crimes which are punishable by imprisonment of 1 year or more or participating in a pre-trial intervention program or on administrative probation by the department.
(2) There must be no more than one temporary customer representative licensee in the general lines agency location where the temporary licensee is housed and the temporary licensee shall be housed wholly and completely within the actual confines of the office of the agent or agency whom he or she represents. No such temporary licensee may be employed from any location except where his or her designated supervising general lines agent spends his or her full time. No general lines agency location may employ more than two temporary customer representative licensees in 1 calendar year.
(3) The temporary licensee cannot be the only person conducting the business of insurance in the office at any time.
(4) The applicant’s employer and supervising general lines agent shall be responsible for the acts of any licensee under this section.
(5) The applicant shall furnish the following with his or her application:
(a) Evidence that the applicant is enrolled in a customer representative educational qualification course which has been approved by the department.
(b) A certificate of employment and a report as to the applicant’s integrity and moral character on a form prescribed by the department and executed by the supervising general lines insurance agent.
(6) Under the temporary license, the licensee shall have the authority to handle only such classes of business as his or her supervising general lines agent is licensed and appointed to handle except as provided herein. A temporary licensee shall not transact life or health insurance business under this license.
(7) In no event shall a temporary licensee licensed under this section perform any of the functions for which a customer representative or general lines agent’s license is required after expiration of the temporary license without having passed the written examination as for a regular customer representative or general lines agent’s license and have subsequently been licensed and appointed as such by the department.
(8) The temporary license shall be effective for a period of 90 days, but shall be subject to earlier termination at the request of the employer or if suspended or revoked by the department.
(9) The department shall not issue a temporary customer representative’s license to any individual who has ever held such a temporary license in this state.
(10) Applicants licensed as temporary customer representatives pursuant to this section shall be appointed as such in accordance with the provisions of ss. 626.112 and 626.451.
(11) The temporary customer representative’s license shall expire 90 days after issuance. The effective date of the license and appointment shall be the date the supervising general lines agent certifies that the applicant is an employee of the agent or agency, provided the applicant meets the requirements for the license as provided in this section. The application for license and supporting documentation shall be mailed to the department within 48 hours after the supervising agent certifies that the applicant is an employee of the agent or agency for purposes of obtaining a license under this section.
(12) The department shall have the authority to take administrative action against the license of a temporary licensee or supervising general lines insurance agent for conduct which is a violation of any provision of this section or other provisions of the Insurance Code or rules of the department.
History.—s. 1, ch. 97-75; s. 39, ch. 99-7; s. 47, ch. 2003-267; s. 40, ch. 2003-281; s. 111, ch. 2004-5; s. 27, ch. 2005-257.
626.741 Nonresident agents; licensing and restrictions.—
(1) The department may, upon written application and the payment of the fees as specified in s. 624.501, issue a license as:
(a) A nonresident general lines agent to an individual licensed in his or her home state as a resident agent for the same line of authority as a Florida resident general lines agent and otherwise qualified therefor under the laws of this state, but who is not a resident of this state, if by the laws of the individual’s home state, residents of this state may be licensed in a similar manner as a nonresident agent of his or her home state.
(b) A customer representative to an individual otherwise qualified therefor, who is not a resident of this state, but is a resident of a state sharing a common boundary with this state.
(2) The department may enter into reciprocal agreements with the appropriate official of any other state waiving the written examination of any applicant resident in that other state if:
(a) In the applicant’s home state, a resident of this state is privileged to procure a general lines agent’s license upon compliance with the conditions specified in subsection (1) and without discrimination as to fees or otherwise in favor of the residents of the individual’s home state.
(b) The appropriate official of the individual’s home state certifies that the applicant holds a currently valid license as a resident agent in his or her home state for the same line of authority as a general lines agent in this state.
(c) The applicant satisfies the examination requirement under s. 626.221, or qualifies for an exemption thereunder.
(3) The department shall not, however, issue any license and appointment to any individual who does not, at the time of issuance and throughout the existence of the Florida license, hold a license as agent or broker issued by his or her home state; nor to any individual who is employed by any insurer as a service representative or who is a managing general agent in any state, whether or not also licensed in another state as an agent or broker. The foregoing requirement to hold a similar license in the applicant’s home state does not apply to customer representatives unless the home state licenses residents of that state in a similar manner. The authority of such nonresident license is limited to the specific lines of authority granted in the license issued by the agent’s home state and further limited to the specific lines authorized under the nonresident license issued by this state. The department shall have discretion to refuse to issue any license or appointment to a nonresident when it has reason to believe that any of the grounds exist as for suspension, denial, or revocation of license as set forth in ss. 626.611 and 626.621.
(4) Any individual who holds a Florida nonresident agent’s license, upon becoming a resident of this state may, for a period not to exceed 90 days, continue to transact insurance in this state under the nonresident license and appointment. Such individual must make application for resident licensure and must become licensed as a resident agent within 90 days of becoming a resident of this state.
(5) Upon becoming a resident of this state, an individual who holds a Florida nonresident agent’s license is no longer eligible for licensure as a nonresident agent if such individual fails to make application for a resident license and become licensed as a resident agent within 90 days. His or her license and any appointments shall be canceled immediately. He or she may apply for a resident license pursuant to s. 626.731.
(6) Except as provided in this section and ss. 626.742 and 626.743, nonresident agents shall be subject to the same requirements as apply to agents resident in this state. However, nonresident agents are not required to maintain an insurance agency in this state. If a nonresident agent does maintain or have a financial interest in an insurance agency in this state, the agency is subject to the same requirements that apply to agencies of resident agents in this state.
(7) If available, the department shall verify the nonresident applicant’s licensing status through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries.
History.—s. 265, ch. 59-205; ss. 13, 35, ch. 69-106; s. 1, ch. 74-148; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 89, ch. 79-40; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 229, 241, 807, 810, ch. 82-243; s. 35, ch. 82-386; s. 19, ch. 87-226; ss. 80, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 250, ch. 97-102; s. 41, ch. 98-199; s. 40, ch. 99-7; s. 13, ch. 2001-142; s. 25, ch. 2002-206; s. 84, ch. 2003-1; s. 48, ch. 2003-267; s. 41, ch. 2003-281; s. 5, ch. 2004-374.
626.742 Nonresident agents; service of process.—
(1) Each licensed nonresident agent shall appoint the Chief Financial Officer as his or her attorney to receive service of legal process issued against the agent in this state, upon causes of action arising within this state out of transactions under the agent’s license and appointment. Service upon the Chief Financial Officer as attorney shall constitute effective legal service upon the agent.
(2) The appointment of the Chief Financial Officer for service of process shall be irrevocable for as long as there could be any cause of action against the agent arising out of his or her insurance transactions in this state.
(3) Duplicate copies of such legal process against such agent shall be served upon the Chief Financial Officer by a person competent to serve a summons.
(4) Upon receiving such service, the Chief Financial Officer shall forthwith send one of the copies of the process, by registered mail with return receipt requested, to the defendant agent at his or her last address of record with the department.
(5) The Chief Financial Officer shall keep a record of the day and hour of service upon him or her of all such legal process.
History.—s. 266, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 230, 241, 807, 810, ch. 82-243; ss. 81, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 251, ch. 97-102; s. 957, ch. 2003-261.
626.743 Nonresident agents; retaliatory provision.—When under the laws of any other state any fine, tax, penalty, license fee, deposit of money or security or other obligation, limitation, or prohibition is imposed upon resident insurance agents of this state in connection with the issuance of, and activities under, a nonresident agent’s license under the laws of such state as to such Florida agent, including the sharing of commissions, then so long as such laws continue in force or are so administered, the same requirements, obligations, limitations, and prohibitions, of whatever kind, shall be imposed upon every insurance agent of such other state doing business in this state under a nonresident agent’s license issued under s. 626.741.
History.—s. 267, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 231, 241, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.744 Service representatives, managing general agents; application for license.—The application for a license as service representative or the application for a license as managing general agent shall show the applicant’s name, residence address, name of employer, position or title, type of work to be performed by the applicant in this state, and any additional information which the department may reasonably require.
History.—s. 268, ch. 59-205; ss. 13, 35, ch. 69-106; s. 22, ch. 71-86; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 232, 241, 807, 810, ch. 82-243; ss. 82, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.745 Service representatives, managing general agents; managers; activities.—Individuals employed by insurers or their managers, general agents, or representatives as service representatives, and as managing general agents employed for the purpose of or engaged in assisting agents in negotiating and effecting contracts of insurance, shall engage in such activities when, and only when, accompanied by an agent duly licensed and appointed as a resident licensee and appointee under this code.
History.—s. 269, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 233, 241, 807, 810, ch. 82-243; ss. 83, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 64, ch. 2002-206.
626.7451 Managing general agents; required contract provisions.—No person acting in the capacity of a managing general agent shall place business with an insurer unless there is in force a written contract between the parties which sets forth the responsibility for a particular function, specifies the division of responsibilities, and contains the following minimum provisions:
(1) The insurer or managing general agent may terminate the contract for cause as provided in the contract upon written notice to the terminated party. The insurer may suspend the underwriting authority of the managing general agent during the pendency of any dispute regarding the cause for termination. The insurer or managing general agent must fulfill any obligations on policies, regardless of any dispute.
(2) The managing general agent shall render accounts to the insurer detailing all transactions and remit all funds due under the terms of the contract to the insurer on a monthly or more frequent basis.
(3) All funds collected for the account of the insurer shall be held by the managing general agent in a fiduciary capacity in a bank which is insured by the Federal Deposit Insurance Corporation. The account shall be used for all payment as directed by the insurer. The managing general agent may retain up to 60 days of estimated claims payments and allocated loss adjustment expenses.
(4) Separate records of business written by the managing general agent shall be maintained unless the managing general agent is a controlled or controlling person. The insurer shall have access and the right to copy all accounts and records related to its business in a form usable by the insurer, and the department and office shall have access to all books, bank accounts, and records of the managing general agent in a form usable to the department and office. The records shall be retained according to s. 626.561.
(5) The contract may not be assigned in whole or part by the managing general agent.
(6) The contract shall specify appropriate underwriting guidelines, including:
(a) The maximum annual premium volume.
(b) The basis of the rates to be charged.
(c) The types of risks which may be written.
(d) Maximum limits of liability.
(e) Applicable exclusions.
(f) Territorial limitations.
(g) Policy cancellation provisions.
(h) The maximum policy period.
This subsection shall not apply when the managing general agent is a controlled or controlling person.
(7) If the contract permits the managing general agent to settle claims on behalf of the insurer:
(a) All claims must be reported to the company in a timely manner and all claims must be adjusted by properly licensed persons.
(b) Notice shall be sent by the managing general agent to the insurer as soon as it becomes known that the claim:
1. Exceeds the limit set by the insurer;
2. Involves a coverage dispute;
3. Exceeds the managing general agent’s claims settlement authority;
4. Is open for more than 6 months; or
5. Is closed by payment of an amount set by the office or an amount set by the insurer, whichever is less.
(c) All claims files shall be the joint property of the insurer and managing general agent. However, upon an order of liquidation of the insurer the claims and related application files shall become the sole property of the insurer or its estate. The managing general agent shall have reasonable access to and the right to copy the files on a timely basis.
(d) Any settlement authority granted to the managing general agent may be terminated for cause upon the insurer’s written notice to the managing general agent or upon the termination of the contract. The insurer may suspend the settlement authority during the pendency of any dispute regarding the cause for termination.
(8) If electronic claims files exist, the contract must address the timely transmission of the data.
(9) If the contract provides for a sharing of interim profits by the managing general agent and the managing general agent has the authority to determine the amount of the interim profits by establishing the total of all loss reserves, including IBNR if any, used in calculating the interim profits, interim profits shall not be paid to the managing general agent until 1 year after the profits are earned for property insurance business and 5 years after they are earned on casualty business and not until the profits have been verified.
(10) The managing general agent shall not:
(a) Bind reinsurance or retrocessions on behalf of the insurer, except that the managing general agent may bind facultative reinsurance if the contract with the insurer contains reinsurance underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers which are authorized, the coverages and amounts or percentages that may be reinsured, and commission schedules and that the insurer has put each reinsurer on notice of the authorization by providing the reinsurer and reinsurance intermediary, if any, with a copy of this section of the contract and that the reinsurer will send confirmation of reinsurance placement directly to the insurer and the managing general agent.
(b) Commit the insurer to participate in insurance or reinsurance syndicates.
(c) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of insurance for which he or she is appointed.
(d) Without prior approval of the insurer, pay or commit the insurer to pay a claim over a specified amount, net of reinsurance, which exceeds 1 percent of the insurer’s policyholder’s surplus as of December 31 of the last completed calendar year.
(e) Collect any payment from a reinsurer or commit the insurer to any claims settlement with a reinsurer without prior approval of the insurer. If prior approval is given, a report must be promptly forwarded to the insurer.
(f) Permit its subproducer to serve on its board of directors.
(g) Appoint a submanaging general agent.
(11) A licensed managing general agent, when placing business with an insurer under this code, may charge a per-policy fee not to exceed $25. In no instance shall the aggregate of per-policy fees for a placement of business authorized under this section, when combined with any other per-policy fee charged by the insurer, result in per-policy fees which exceed the aggregate amount of $25. The per-policy fee shall be a component of the insurer’s rate filing and shall be fully earned.
For the purposes of this section and ss. 626.7453 and 626.7454, the term “controlling person” or “controlling” has the meaning set forth in s. 625.012(5)(b)1., and the term “controlled person” or “controlled” has the meaning set forth in s. 625.012(5)(b)2.
History.—ss. 84, 207, ch. 90-363; s. 1, ch. 91-296; s. 4, ch. 91-429; s. 252, ch. 97-102; s. 958, ch. 2003-261; s. 77, ch. 2003-281; s. 1, ch. 2003-407; s. 7, ch. 2011-174.
626.7452 Managing general agents; examination authority.—The acts of the managing general agent are considered to be the acts of the insurer on whose behalf it is acting. A managing general agent may be examined as if it were the insurer except in the case where the managing general agent solely represents a single domestic insurer.
History.—ss. 85, 207, ch. 90-363; s. 4, ch. 91-429.
626.7453 Managing general agents; errors and omissions insurance.—As a part of the appointment process, the insurer appointing the managing general agent shall certify that, upon investigation and to the best of the insurer’s knowledge and belief, the proposed managing general agent has obtained errors and omissions insurance in an amount acceptable to the insurer appointing the managing general agent. This section does not apply to a managing general agent that is a controlled or controlling person.
History.—ss. 86, 207, ch. 90-363; s. 4, ch. 91-429.
626.7454 Managing general agents; duties of insurers.—
(1) The insurer shall have on file for each managing general agent with which it has done business an independent financial examination in a form acceptable to the office.
(2) If a managing general agent establishes total loss reserves, including IBNR if any, the insurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the managing general agent. This subsection is in addition to any other requirement of loss reserve certification.
(3) The insurer shall, at least annually, conduct an onsite review of the underwriting and claims processing operations of the managing general agent; however, the insurer shall conduct an onsite review of the underwriting and claims processing operations of a newly engaged managing general agent within 6 months after he or she is engaged.
(4) Binding authority for all reinsurance contracts or participation in insurance or reinsurance syndicates shall rest with an officer of the insurer, who shall not be affiliated with the managing general agent.
(5) Within 30 days after entering into or terminating a contract with a managing general agent, the insurer shall provide written notification of the appointment or termination to the department and office. Notices of appointment of a managing general agent shall include a statement of duties which the applicant is expected to perform on behalf of the insurer, the lines of insurance for which the applicant is to be authorized to act, and any other information the department or office may request.
(6) An insurer shall review its books and records on a quarterly basis to determine if any producer has become a managing general agent as defined in s. 626.015. If the insurer determines that a producer has become a managing general agent, the insurer shall promptly notify the producer and the department and office of such determination and the insurer and producer must fully comply with the provisions of this section and ss. 626.7451, 626.7452, and 626.7453 within 30 days after such determination.
Subsections (1), (3), and (4) do not apply to a managing general agent that is a controlled or controlling person.
History.—ss. 87, 207, ch. 90-363; s. 2, ch. 91-296; s. 4, ch. 91-429; s. 253, ch. 97-102; s. 26, ch. 2002-206; s. 959, ch. 2003-261.
626.7455 Managing general agent; responsibility of insurer.—
(1) No insurer shall enter into an agreement with any person to manage the business written in this state by the general lines agents appointed by the insurer or appointed by the managing general agent on behalf of the insurer unless the person is properly licensed and appointed as a managing general agent in this state. An insurer shall be responsible for the acts of its managing general agent when the agent acts within the scope of his or her authority.
(2) This section does not apply to surplus lines insurance when written pursuant to the Surplus Lines Law, ss. 626.913-626.937.
History.—s. 27, ch. 2002-206.
626.747 Branch agencies.—
(1)(a) Each branch place of business established by an agent or agency, firm, corporation, or association shall be in the active full-time charge of a licensed general lines agent or life or health agent who is appointed to represent one or more insurers. Any agent or agency, firm, corporation, or association which has established one or more branch places of business shall be required to have at least one licensed general lines agent who is appointed to represent one or more insurers at each location of the agency including its headquarters location.
(b) Notwithstanding paragraph (a), the licensed agent in charge of an insurance agency may also be the agent in charge of additional branch office locations of the agency if insurance activities requiring licensure as an insurance agent do not occur at any location when the agent is not physically present and unlicensed employees at the location do not engage in any insurance activities requiring licensure as an insurance agent or customer service representative.
(2) If the agent or agency establishes places of business in more than one county, additional county tax is payable as provided in s. 624.505.
History.—s. 271, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 234, 241, 807, 810, ch. 82-243; ss. 88, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 23, ch. 2004-374; s. 28, ch. 2005-257; s. 4, ch. 2007-199.
626.748 Agent’s records.—Every agent transacting any insurance policy must maintain in his or her office, or have readily accessible by electronic or photographic means, such records of policies transacted by him or her as to enable the policyholders and department to obtain all necessary information, including daily reports, applications, change endorsements, or documents signed or initialed by the insured concerning such policies.
History.—s. 272, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 235, 241, 807, 810, ch. 82-243; ss. 89, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 254, ch. 97-102.
626.749 Place of business in residence.—No requirement of this part that an agent maintain within this state a place of business which is accessible to the public shall be deemed to prohibit the maintenance of such a place of business in connection with the place of residence of either the agent or of other persons, if:
(1) A separate room is set aside by the agent for, and is actually used as, the office or place of business;
(2) Such room is easily accessible to the public and is in fact in the usual course of business used by the agent in his or her dealings with the public; and
(3) The existence of such place of business is suitably advertised, as determined by the department.
History.—s. 273, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 241, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 255, ch. 97-102.
626.7491 Business transacted with producer controlled property and casualty insurer.—
(1) SHORT TITLE.—This section may be cited as the “Business Transacted with Producer Controlled Property or Casualty Insurer Act.”
(2) DEFINITIONS.—As used in this section:
(a) “Accredited state” means a state in which the department or agency which regulates insurance has qualified as meeting the minimum financial regulatory standards adopted and established from time to time by the National Association of Insurance Commissioners (NAIC).
(b) “Control” or “controlled” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a contract for goods or nonmanagement services, or otherwise. Control shall be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing 10 percent or more of the outstanding voting securities of any other person. No person shall be deemed to control another person solely by reason of being an officer or director of such other person.
(c) “Controlled insurer” means a licensed insurer which is controlled, directly or indirectly, by a producer.
(d) “Controlling producer” means a producer who, directly or indirectly, controls an insurer.
(e) “Licensed insurer” or “insurer” means any person, firm, association, or corporation licensed to transact a property or casualty insurance business in this state. The following are not licensed insurers for the purposes of this section:
1. Any risk retention group as defined in:
a. The Superfund Amendments Reauthorization Act of 1986, Pub. L. No. 99-499, 100 Stat. 1613 (1986);
b. The Risk Retention Act, 15 U.S.C. ss. 3901 et seq. (1982 and Supp. 1986); or
c. Section 627.942(9);
2. Any residual market pool or joint underwriting authority or association; and
3. Any captive insurance company as defined in s. 628.901.
(f) “Producer” means an insurance agent or agents or any other person who, for any compensation, commission, or other thing of value, acts or aids in any manner in soliciting, negotiating, or procuring the making of any insurance contract on behalf of an insured other than the person.
(3) APPLICABILITY.—This section shall apply to licensed insurers domiciled in this state or domiciled in a state that is not an accredited state having in effect a law substantially similar to this section. The provisions of ss. 628.801-628.803, to the extent they are not superseded by this section, shall continue to apply to all parties within holding company systems subject to this section.
(4) MINIMUM STANDARDS.—
(a) The provisions of this section apply if, in any calendar year, the aggregate amount of gross written premiums on business placed with a controlled insurer by a controlling producer is equal to or greater than 5 percent of the admitted assets of the controlled insurer, as reported in the controlled insurer’s annual statement filed as of December 31 of the prior year.
(b) Notwithstanding the provisions of paragraph (a), the provisions of this subsection and subsections (5), (6), and (7) do not apply if:
1. The controlling producer places insurance only with the controlled insurer, or only with the controlled insurer and any members of the controlled insurer’s holding company system, or the controlled insurer’s parent, affiliate, or subsidiary and receives no compensation based upon the amount of premiums written in connection with such insurance;
2. The controlling producer accepts insurance placements only from nonaffiliated subproducers and not directly from insureds; and
3. The controlled insurer, except for insurance business written through a risk apportionment plan as provided in s. 627.351, accepts insurance business only from a controlling producer, a producer controlled by the controlled insurer, or a producer that is a subsidiary of the controlled insurer.
(5) REQUIRED CONTRACT PROVISIONS.—A controlled insurer shall not accept business from a controlling producer and a controlling producer shall not place business with a controlled insurer unless there is a written contract between the controlling producer and the insurer specifying the responsibilities of each party, which contract has been approved by the board of directors of the insurer and contains the following minimum provisions:
(a) The controlled insurer may terminate the contract for cause, upon written notice to the controlling producer. The controlled insurer shall suspend the authority of the controlling producer to write business during the pendency of any dispute regarding the cause for the termination.
(b) The controlling producer shall render accounts to the controlled insurer detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the controlling producer.
(c) The controlling producer shall remit all funds due under the terms of the contract to the controlled insurer, at least monthly. The due date shall be fixed so that premiums, or installments thereof, collected shall be remitted no later than 90 days after the effective date of any policy placed with the controlled insurer under such contract.
(d) All funds collected for the controlled insurer’s account shall be held by the controlling producer in a fiduciary capacity, in one or more appropriately identified bank accounts in banks that are members of the Federal Reserve System, in accordance with the applicable provisions of the Florida Insurance Code. However, funds of a controlling producer not required to be licensed in this state shall be maintained in compliance with the requirements of the jurisdiction of the controlling producer’s domicile.
(e) The controlling producer shall maintain separately identifiable records of business written for the controlled insurer.
(f) The contract shall not be assigned in whole or in part by the controlling producer.
(g) The controlled insurer shall provide the controlling producer with its underwriting standards, rules and procedures, manuals setting forth the rates to be charged, and the conditions for the acceptance or rejection of risks. The controlling producer shall adhere to the standards, rules, procedures, rates, and conditions. The standards, rules, procedures, rates, and conditions shall be the same as those applicable to comparable business placed with the controlled insurer by a producer other than the controlling producer.
(h) The contract must specify the rates and terms of the controlling producer’s commissions, charges, or other fees and the purposes for those charges or fees. The rates of the commissions, charges, and other fees shall be no greater than those applicable to comparable business placed with the controlled insurer by producers other than controlling producers. For purposes of this paragraph and paragraph (g), examples of “comparable business” include the same lines of insurance, same kinds of insurance, same kinds of risks, similar policy limits, and similar quality of business.
(i) If the contract provides that the controlling producer, on insurance business placed with the insurer, is to be compensated contingent upon the insurer’s profits on that business, then such compensation shall not be determined and paid until at least 5 years after the premiums on liability insurance are earned and at least 1 year after the premiums are earned on any other insurance. In no event shall the commissions be paid until the adequacy of the controlled insurer’s reserves on remaining claims has been independently verified pursuant to paragraph (7)(a).
(j) The contract must specify a limit on the controlling producer’s writings in relation to the controlled insurer’s surplus and total writings. The insurer may establish a different limit for each line or subline of business. The controlled insurer shall notify the controlling producer when the applicable limit is approached and shall not accept business from the controlling producer after the limit is reached. The controlling producer shall not place business with the controlled insurer if it has been notified by the controlled insurer that the limit has been reached.
(k) The controlling producer may negotiate but shall not bind reinsurance on behalf of the controlled insurer on business the controlling producer places with the controlled insurer, except the controlling producer may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the controlled insurer contains underwriting guidelines including, for both reinsurance assumed and ceded, a list of reinsurers with which such automatic agreements are in effect, the coverages and amounts or percentages that may be reinsured, and commission schedules.
(6) AUDIT COMMITTEE.—Every controlled insurer shall have an audit committee of the board of directors composed of independent directors. The audit committee shall annually meet with management, the insurer’s independent certified public accountants, and an independent casualty actuary or other independent loss reserve specialist acceptable to the office to review the adequacy of the insurer’s loss reserves.
(7) REPORTING REQUIREMENTS.—
(a) In addition to any other required loss reserve certification, the controlled insurer shall, on April 1 of each year, file with the office the opinion of an independent casualty actuary, or such other independent loss reserve specialist acceptable to the office, reporting loss ratios for each line of business written and attesting to the adequacy of loss reserves established for losses incurred and outstanding as of the year end, including incurred but not reported losses, on business placed by the producer.
(b) The controlled insurer shall annually report to the office the amount of commissions paid to the producer, the percentage such amount represents of the net premiums written, and comparable amounts and percentages paid to noncontrolling producers for placements of the same kinds of insurance.
(8) PENALTIES.—
(a) If the department believes that the controlling producer or any other person has not materially complied with this section, or any rule adopted or order issued hereunder, the department may order the controlling producer to cease placing business with the controlled insurer.
(b) If, due to such material noncompliance, the controlled insurer or any policyholder thereof has suffered any loss or damage, the department or office may maintain a civil action or intervene in an action brought by or on behalf of the insurer or policyholder for recovery of compensatory damages for the benefit of the insurer or policyholder or other appropriate relief.
(c) If an order for liquidation or rehabilitation of the controlled insurer has been entered pursuant to chapter 631 and the receiver appointed under such order believes that the controlling producer or any other person has not materially complied with this section or any rule adopted or order issued hereunder and the insurer has suffered any loss or damage therefrom, the receiver may maintain a civil action for recovery of damages or other appropriate sanctions for the benefit of the insurer.
(d) Nothing contained in this section shall affect the right of the department or office to impose any other penalties provided for in the Florida Insurance Code.
(e) Nothing contained in this section is intended to or shall in any manner alter or affect the rights of policyholders, claimants, creditors, or other third parties.
(9) DISCLOSURE REQUIREMENT.—A property or casualty insurer that is controlled by a producer may not accept business from such producer in any transaction unless the producer, prior to the effective date of the policy, delivers written notice, signed by the insured, to the prospective insured disclosing the relationship between the insurer and the controlling producer. The disclosure must be retained in the underwriting file until the filing of the report on examination covering the period in which the coverage is in effect; however, if the business is placed through a subproducer who is not a controlling producer, the controlling producer and the controlled insurer shall retain in its records a signed commitment from the subproducer that the subproducer is aware of the relationship between the insurer and the producer and that the subproducer has or will notify the insured.
History.—s. 40, ch. 92-146; s. 11, ch. 93-410; s. 960, ch. 2003-261; s. 35, ch. 2012-151.
626.7492 Reinsurance intermediaries.—
(1) SHORT TITLE.—This section may be cited as the “Reinsurance Intermediary Act.”
(2) DEFINITIONS.—As used in this section:
(a) “Actuary” means a person who is a member in good standing of the American Academy of Actuaries.
(b) “Controlling person” means any person, firm, association, or corporation who directly or indirectly has the power to direct or cause to be directed, the management, control, or activities of the reinsurance intermediary.
(c) “Insurer” means any person duly licensed in this state pursuant to the applicable provisions of the Florida Insurance Code as an insurer.
(d) “Producer” means an agent, broker, or reinsurance intermediary licensed pursuant to the applicable provision of the Florida Insurance Code.
(e) “Reinsurance intermediary” means a reinsurance intermediary broker or a reinsurance intermediary manager.
(f) “Reinsurance intermediary broker” means any person, other than an officer or employee of the ceding insurer, who solicits, negotiates, or places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority or power to bind reinsurance on behalf of the ceding insurer.
(g) “Reinsurance intermediary manager” means any person who has authority to bind, or manages all or part of, the assumed reinsurance business of a reinsurer, including the management of a separate division, department, or underwriting office, and acts as an agent for the reinsurer whether known as a reinsurance intermediary manager, manager, or other similar term. Notwithstanding the above, none of the following persons is a reinsurance intermediary manager with respect to the reinsurer for the purposes of this section:
1. An employee of the reinsurer;
2. A manager of the United States branch of an alien reinsurer;
3. An underwriting manager which, pursuant to contract, manages all the reinsurance operations of the reinsurer, is under common control with the reinsurer, subject to the holding company act, and whose compensation is not based on the volume of premiums written.
4. The manager of a group, association, pool, or organization of insurers which engage in joint underwriting or joint reinsurance and who are subject to examination by the insurance regulatory authority of the state in which the manager’s principal business office is located.
(h) “Reinsurer” means any person duly licensed in this state pursuant to the applicable provisions of the Florida Insurance Code as an insurer with the authority to assume reinsurance.
(i) “Violation” means failure by the reinsurance intermediary, insurer, or reinsurer for whom the reinsurance intermediary was acting to substantially comply with the provisions of this section.
(j) “Qualified United States financial institution” means an institution that:
1. Is organized or, in the case of a United States office of a foreign banking organization, licensed under the laws of the United States or any state thereof;
2. Is regulated, supervised, and examined by federal or state authorities having regulatory authority over banks and trust companies; and
3. Has been determined by the department or the Securities Valuation Office of the National Association of Insurance Commissioners to meet the standards of financial condition and standing that are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit will be acceptable to the department.
(3) LICENSURE.—
(a) No person shall act as a reinsurance intermediary broker in this state if the reinsurance intermediary broker maintains an office either directly or as a member or employee of a firm or association, or an officer, director, or employee of a corporation:
1. In this state, unless the reinsurance intermediary broker is a licensed producer in this state; or
2. In another state, unless the reinsurance intermediary broker is a licensed producer in this state or in another state having a law substantially similar to this section or the reinsurance intermediary broker is licensed in this state as a nonresident reinsurance intermediary.
(b) No person shall act as a reinsurance intermediary manager:
1. For a reinsurer domiciled in this state, unless the reinsurance intermediary manager is a licensed producer in this state;
2. In this state, if the reinsurance intermediary manager maintains an office either directly or as a member or employee of a firm or association, or an officer, director, or employee of a corporation in this state, unless the reinsurance intermediary manager is a licensed producer in this state;
3. In another state for a nondomestic insurer, unless the reinsurance intermediary manager is a licensed producer in this state or another state having a law substantially similar to this section, or the person is licensed in this state as a nonresident reinsurance intermediary.
(c) The department may require a reinsurance intermediary manager subject to the provisions of this section to:
1. File a bond from an insurer in an amount acceptable to the department for the protection of the reinsurer; and
2. Maintain an errors and omissions insurance policy in an amount acceptable to the department.
(d) The department may issue a reinsurance intermediary license to any person who has complied with the requirements of this section. Any license issued to a person who is not an individual must authorize each member of the person and any designated employee to act as a reinsurance intermediary under the license, and each member and designated individual must be named in the application and any supplements thereto. Any license issued to a corporation must authorize any officer, and any designated employee or designated director thereof, to act as a reinsurance intermediary on behalf of the corporation, and each officer and designated employee and director must be named in the application and any supplements thereto.
(e) If the applicant for a reinsurance intermediary license is a nonresident, the applicant, as a condition precedent to receiving or holding a license, must designate the Chief Financial Officer as agent for service of process in the manner, and with the same legal effect, provided for by this section for designation of service of process upon unauthorized insurers. Such applicant shall also furnish the department with the name and address of a resident of this state upon whom notices or orders of the department or process affecting the nonresident reinsurance intermediary may be served. The licensee shall promptly notify the department in writing of each change in its designated agent for service of process, and the change shall not become effective until acknowledged by the department.
(f) The department may refuse to issue a reinsurance intermediary license if, in its judgment, the applicant, anyone named on the application, or any member, principal, officer, or director of the applicant, has demonstrated a lack of fitness and trustworthiness, or that any controlling person of the applicant is not fit or trustworthy to act as a reinsurance intermediary, or that any of the foregoing has given cause for revocation or suspension of the license, or has failed to comply with any prerequisite for the issuance of the license.
(g) Reinsurance intermediaries shall be licensed, appointed, renewed, continued, reinstated, or terminated as prescribed in this chapter for insurance representatives in general, except that they shall be exempt from the photo, education, and examination provisions. License, appointment, and other fees shall be those prescribed in s. 624.501.
(h) The grounds and procedures for refusal of a license or appointment or suspension or revocation of a license or appointment issued to a reinsurance intermediary under this section are as set forth in ss. 626.611-626.691 for insurance representatives in general.
(i) An attorney licensed in this state, when acting in a professional capacity, is exempt from this subsection.
(j) The department may develop necessary rules to carry out this section.
(4) REQUIRED CONTRACT PROVISIONS; REINSURANCE INTERMEDIARY BROKERS.—A transaction between a reinsurance intermediary broker and the insurer it represents in the capacity of a reinsurance intermediary broker may be entered into only pursuant to a written authorization specifying the responsibilities of each party. The authorization must provide, at a minimum, that:
(a) The insurer may terminate the reinsurance intermediary broker’s authority at any time.
(b) The reinsurance intermediary broker must render accounts to the insurer accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by, or owing to, the reinsurance intermediary broker and must remit all funds due to the insurer within 30 days after receipt.
(c) All funds collected for the insurer’s account will be held by the reinsurance intermediary broker in a fiduciary capacity in a bank which is a qualified United States financial institution.
(d) The reinsurance intermediary broker will comply with the provisions of subsection (5).
(e) The reinsurance intermediary broker will comply with the written standards established by the insurer for the cession or retrocession of all risks.
(f) The reinsurance intermediary broker will disclose to the insurer any relationship with any reinsurer to which business will be ceded or retroceded.
(5) BOOKS AND RECORDS; REINSURANCE INTERMEDIARY BROKERS.—
(a) For at least 10 years after expiration of each contract of reinsurance transacted by the reinsurance intermediary broker, the reinsurance intermediary broker must keep a complete record for each transaction showing:
1. The type of contract, limits, underwriting restrictions, classes or risks, and territory;
2. The period of coverage, including effective and expiration dates, cancellation provisions, and notice required of cancellation;
3. Reporting and settlement requirements of balances;
4. The rate used to compute the reinsurance premium;
5. The names and addresses of assuming reinsurers;
6. The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the reinsurance intermediary broker;
7. Related correspondence and memoranda;
8. Proof of placement;
9. Details regarding retrocessions handled by the reinsurance intermediary broker, including the identity of retrocessionaires and the percentage of each contract assumed or ceded;
10. Financial records, including, but not limited to, premium and loss accounts; and
11. If the reinsurance intermediary broker procures a reinsurance contract on behalf of a licensed ceding insurer:
a. Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
b. If such contract is placed through a representative of the assuming reinsurer, other than an employee, written evidence that the reinsurer has delegated binding authority to the representative.
(b) The insurer will have access and the right to copy and audit all accounts and records maintained by the reinsurance intermediary broker related to its business in a form usable by the insurer.
(6) DUTIES OF INSURERS USING THE SERVICES OF A REINSURANCE INTERMEDIARY BROKER.—
(a) An insurer shall not engage the services of any person to act as a reinsurance intermediary broker on its behalf unless the person is licensed pursuant to this section.
(b) An insurer may not employ an individual who is employed by a reinsurance intermediary broker with which it transacts business, unless the reinsurance intermediary broker is under common control with the insurer and subject to ss. 628.801, 628.802, and 628.803.
(c) The insurer shall annually obtain a copy of statements of the financial condition of each reinsurance intermediary broker with which it transacts business.
(7) REQUIRED CONTRACT PROVISIONS; REINSURANCE INTERMEDIARY MANAGERS.—Transactions between a reinsurance intermediary manager and the reinsurer it represents in that capacity may be entered into pursuant only to a written contract specifying the responsibilities of each party, which must be approved by the reinsurer’s board of directors. At least 30 days before the reinsurer assumes or cedes business through the producer, a true copy of the approved contract must be filed with the department for approval. The contract must provide, at a minimum, that:
(a) The reinsurer may terminate the contract for cause upon written notice to the reinsurance intermediary manager. The reinsurer may immediately suspend the authority of the reinsurance intermediary manager to assume or cede business during the pendency of any dispute regarding the cause for termination.
(b) The reinsurance intermediary manager must render accounts to the reinsurer, accurately detailing all material transactions, including information necessary to support all commissions, charges, and other fees received by or owing to the reinsurance intermediary manager, and must remit all funds due under the contract to the reinsurer at least monthly.
(c) All funds collected for the reinsurer’s account must be held by the reinsurance intermediary manager in a fiduciary capacity in a bank which is a qualified United States financial institution. The reinsurance intermediary manager may retain no more than 3 months’ estimated claims payments and allocated loss adjustment expenses. The reinsurance intermediary manager shall maintain a separate bank account for each reinsurer which it represents.
(d) For at least 10 years after expiration of each contract of reinsurance transacted by the reinsurance intermediary manager, the reinsurance intermediary manager must keep a complete record of each transaction, showing:
1. The type of contract, limits, underwriting restrictions, classes or risks, and territory;
2. The period of coverage, including effective and expiration dates, cancellation provisions and notice required of cancellation, and disposition of outstanding reserves on covered risks;
3. The reporting and settlement requirements of balances;
4. The rate used to compute the reinsurance premium;
5. The names and addresses of reinsurers;
6. The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the reinsurance intermediary manager;
7. Related correspondence and memoranda;
8. Proof of placement;
9. Details regarding retrocessions handled by the reinsurance intermediary manager, as permitted by this section, including the identity of retrocessionaires and the percentage of each contract assumed or ceded;
10. Financial records, including, but not limited to, premium and loss accounts; and
11. If the reinsurance intermediary manager places a reinsurance contract on behalf of a ceding insurer:
a. Directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or
b. If such contract is placed through a representative of the assuming reinsurer, other than an employee, written evidence that such reinsurer has delegated binding authority to the representative.
(e) The reinsurer shall have access to and the right to copy all accounts and records maintained by the reinsurance intermediary manager related to its business in a form usable by the reinsurer.
(f) The contract cannot be assigned in whole or in part by the reinsurance intermediary manager.
(g) The reinsurance intermediary manager will comply with the written underwriting and rating standards established by the insurer for the acceptance, rejection, or cession of all risks.
(h) Sets forth the rates, terms, and purposes of commissions, charges, and other fees which the reinsurance intermediary manager may levy against the reinsurer.
(i) If the contract permits the reinsurance intermediary manager to settle claims on behalf of the reinsurer:
1. All claims will be reported to the reinsurer in a timely manner.
2. A copy of the claim file will be sent to the reinsurer at its request or as soon as it becomes known that the claim:
a. Has the potential to exceed the lesser of an amount determined by the department or the limit set by the reinsurer;
b. Involves a coverage dispute;
c. May exceed the reinsurance intermediary manager’s claims settlement authority;
d. Is open for more than 6 months; or
e. Is closed by payment of the lesser of an amount set by the department or an amount set by the reinsurer.
3. All claim files will be the joint property of the reinsurer and reinsurance intermediary manager provided that upon an order of liquidation of the reinsurer, the files shall become the sole property of the reinsurer or its estate; provided, further, that the reinsurance intermediary manager must have reasonable access to and the right to copy the files on a timely basis.
4. Any settlement authority granted to the reinsurance intermediary manager may be terminated for cause upon the reinsurer’s written notice to the reinsurance intermediary manager or upon the termination of the contract. The reinsurer may suspend the settlement authority during the pendency of the dispute regarding the cause of termination.
(j) If the contract provides for a sharing of interim profits by the reinsurance intermediary manager, that the interim profits will not be paid until 1 year after the end of each underwriting period for property business and 5 years after the end of each underwriting period for casualty business, or a later period set by the department for specified lines of insurance, and not until the adequacy of reserves on remaining claims has been verified pursuant to this section.
(k) The reinsurance intermediary manager must annually provide the reinsurer with a statement of its financial condition prepared by an independent certified accountant.
(l) The reinsurer must at least semiannually conduct an onsite review of the underwriting and claims processing operations of the reinsurance intermediary manager.
(m) The reinsurance intermediary manager must disclose to the reinsurer any relationship it has with any insurer prior to ceding or assuming any business with the insurer pursuant to this contract.
(n) Within the scope of its actual or apparent authority, the acts of the reinsurance intermediary manager shall be deemed to be the acts of the reinsurer on whose behalf it is acting.
(8) PROHIBITED ACTS.—The reinsurance intermediary manager shall not:
(a) Cede retrocessions on behalf of the reinsurer, except that the reinsurance intermediary manager may cede facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for the retrocessions. The guidelines must include a list of reinsurers with which the automatic agreements are in effect, and for each of these reinsurers, the coverages and amounts or percentages that may be reinsured, and commission schedules.
(b) Commit the reinsurer to participate in reinsurance syndicates.
(c) Appoint any producer without assuring that the producer is lawfully licensed to transact the type of reinsurance for which he or she is appointed.
(d) Without prior approval of the reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions, that exceeds the lesser of an amount specified by the reinsurer or 1 percent of the reinsurer’s policyholder’s surplus as of December 31 of the last complete calendar year.
(e) Collect any payment from a retrocessionaire or commit the reinsurer to any claim settlement with a retrocessionaire, without prior approval of the reinsurer. If prior approval is given, a report must be promptly forwarded to the reinsurer.
(f) Jointly employ an individual who is employed by the reinsurer, unless such reinsurance intermediary manager is under common control with the reinsurer subject to ss. 628.801, 628.802, and 628.803.
(g) Appoint a sub-reinsurance intermediary manager.
(9) DUTIES OF REINSURERS USING THE SERVICES OF A REINSURANCE INTERMEDIARY MANAGER.—
(a) A reinsurer may not engage the services of any person to act as a reinsurance intermediary manager on its behalf unless the person is licensed as required by this section.
(b) The reinsurer must annually obtain a copy of statements of the financial condition of each reinsurance intermediary manager which the reinsurer has engaged prepared by an independent certified accountant in a form acceptable to the department.
(c) If a reinsurance intermediary manager establishes loss reserves, the reinsurer must annually obtain the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the reinsurance intermediary manager. This opinion must be in addition to any other required loss reserve certification.
(d) Binding authority for all retrocessional contracts or participation in reinsurance syndicates must rest with an officer of the reinsurer who shall not be affiliated with the reinsurance intermediary manager.
(e) Within 30 days of termination of a contract with a reinsurance intermediary manager, the reinsurer must provide written notification of the termination to the department.
(f) A reinsurer shall not appoint to its board of directors any officer, director, employee, controlling shareholder, or subproducer of its reinsurance intermediary manager. This paragraph shall not apply to relationships governed by ss. 628.801, 628.802, and 628.803 or, if applicable, this section.
(10) EXAMINATION AUTHORITY.—
(a) A reinsurance intermediary is subject to examination by the department. The department shall have access to all books, bank accounts, and records of the reinsurance intermediary in a form usable to the department.
(b) A reinsurance intermediary manager may be examined as if it were the reinsurer.
(11) PENALTIES AND LIABILITIES.—
(a) A reinsurance intermediary found by the department, or an insurer or reinsurer found by the office, to be in violation of any provision of this section must:
1. For each separate violation pay a penalty in an amount not to exceed $5,000;
2. Be subject to revocation or suspension of its license; and
3. If a violation was committed by the reinsurance intermediary, the reinsurance intermediary must make restitution to the insurer, reinsurer, rehabilitator, or liquidator of the insurer or reinsurer for the net losses incurred by the insurer or reinsurer attributable to the violation.
(b) Nothing contained in this section shall affect the right of the office or department to impose any other penalties provided in the Florida Insurance Code.
(c) Nothing contained in this section is intended to or shall in any manner limit or restrict the rights of policyholders, claimants, creditors, or other third parties or confer any rights to these persons.
History.—s. 41, ch. 92-146; s. 1, ch. 95-135; s. 256, ch. 97-102; s. 961, ch. 2003-261.
626.752 Exchange of business.—
(1) As used in this section:
(a) “Brokering agent” means an originating general lines agent placing business with a company with which he or she is not appointed.
(b) “Prominently displayed” means that the printed matter is:
1. In at least 12-point type or type of the same size as any other entity name, whichever is larger;
2. In all capital letters or in boldfaced type;
3. In a typeface which is selected with legibility as the primary consideration; and
4. Printed with the name of the insurer at the top of the form with no artwork or printed matter preceding or above it.
(2) Subject to the provisions of subsection (3), an agent may place with an insurer for which he or she is not an appointed agent only such business for which he or she is appointed and which the insurer by which he or she is appointed is authorized to write.
(3)(a) An insurer may furnish to general lines agents who are not appointed by the insurer its forms, coverage documents, binders, applications, and other incidental supplies only for the purposes set forth in this section and only to the extent necessary to facilitate the writing of exchange of business pursuant to this section. The insurer shall assign a unique brokering agent’s register number to each agent not appointed with the insurer but furnished with the insurer’s forms, coverage documents, binders, applications, and other incidental supplies.
(b) Each form, coverage document, binder, and application shall contain the following legend prominently displayed which shall be properly and completely filled out by the agent when utilized: “BROKERING AGENT’S REGISTER NO. .”
(c) The following legend must immediately preface a line provided for the applicant’s signature on the application which shall be properly and completely filled out by the agent when utilized: “I understand this application is not a binder unless indicated as such on this form by the brokering agent.”
(d) When business is placed under subsection (2), the following legend must preface a line provided for the brokering agent’s signature which shall be properly and completely filled out by the agent when utilized: “This application is in compliance with Section 626.752, Florida Statutes. A copy has been furnished to the applicant or insured and coverage is: [ ] Bound effective (time) (date) ; [ ] Not bound.”
(e) The brokering agent shall maintain an appropriate and permanent Brokering Agent’s Register, which shall be a bound journal in which chronologically numbered transactions are entered no later than the day in which the brokering agent’s application bearing the same number is signed by the applicant. The numbers shall reflect an annual aggregate through numerical sequence and be preceded by the last two digits of the current year. The initial entry shall contain the number of the transaction, date, time, date of binder, date on which coverage commences, name and address of applicant, type of coverage desired, name of insurer binding the risk or to whom the application is to be submitted, and the amount of any premium collected therefor. By no later than the date following policy delivery, the policy number and coverage expiration date shall be added to the register.
(f) Policies written in accordance with this section shall be properly countersigned in accordance with the provisions of s. 624.425.
(g)1. Any insurer furnishing forms, coverage documents, binders, applications, and incidental supplies to an agent not appointed with the insurer shall keep a log sufficient to identify the agent.
2. With respect to business placed under this section, if an agent collects a premium or other payment from an insured, the payment to the agent shall be deemed to constitute payment to the insurer.
3. The agent shall furnish the applicant or insured with completed legible copies of all documents signed by the applicant or the agent before the applicant pays any part of the premium. Such documents include, but are not limited to, applications, receipts, coverage selection forms, and outlines of coverage.
(h)1. No insurer shall furnish forms, coverage documents, binders, applications, and incidental supplies to an agent, for the purposes of this section, whether or not appointed with the insurer unless the name of the insurer is prominently displayed thereon.
2. No agent shall utilize a form, coverage documents, binder, or application which does not have prominently displayed on its face the insurer’s name.
3. No agent shall utilize a form, coverage document, binder, or application not furnished by the insurer or not furnished on behalf of the insurer by its managing general agent with respect to which the form, coverage document, binder, or application applies.
4. The agent shall not place any business pursuant to this section unless the agent has fully complied with all requirements of this section.
5. No insurer shall accept business from an agent not appointed with the insurer on a form, coverage document, binder, or application not furnished to the agent by the insurer.
6. No business shall be placed pursuant to subsection (2), using a form, coverage document, binder, or application containing the name of more than one insurer with check-off boxes or spaces in which the agent indicates the insurer with which coverage is bound or with respect to which premium is collected.
(i) No provision of this section shall be construed to limit the rights of any person afforded under s. 626.342.
(4) The foregoing limitations and restrictions shall not be construed and shall not apply to the placing of surplus lines business under the provisions of part VIII.
(5) Within 15 days after the last day of each month, any insurer accepting business under this section shall report to the department the name, address, telephone number, and social security number of each agent from which the insurer received more than 24 personal lines risks during the calendar year, except for risks being removed from the Citizens Property Insurance Corporation and placed with that insurer by a brokering agent. Once the insurer has reported pursuant to this subsection an agent’s name to the department, additional reports on the same agent shall not be required. However, the fee set forth in s. 624.501 shall be paid for the agent by the insurer for each year until the insurer notifies the department that the insurer is no longer accepting business from the agent pursuant to this section. The insurer may require that the agent reimburse the insurer for the fee.
(6) If a managing general agent handles or an insurer accepts business under this section, relative to that business:
(a) The managing general agent or insurer shall be liable to the insured for coverage arising hereunder and for the acts of the agent in producing that business; and
(b) The managing general agent or insurer shall be responsible and accountable to the insured relating to violations of this section for misappropriation of funds by brokering agents as to business placed within the insurer’s approved underwriting guidelines and contracts.
(7) If an insurer accepts business in violation of this section, the insurer shall be liable for coverage arising thereunder.
History.—s. 276, ch. 59-205; s. 1, ch. 71-326; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 238, 241, 807, 810, ch. 82-243; s. 20, ch. 87-226; s. 1, ch. 88-104; ss. 90, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 4, ch. 95-276; s. 2, ch. 97-55; s. 257, ch. 97-102; s. 962, ch. 2003-261; s. 6, ch. 2004-374.
626.753 Sharing commissions; penalty.—
(1)(a) An agent may divide or share in commissions only with other agents appointed and licensed to write the same kind or kinds of insurance.
(b) This section shall not be construed to prevent the payment or receipt of renewal commissions or other deferred commissions or pensions to or by any person solely because such person has ceased to hold a license to act as an insurance agent, and shall not prevent the payment of renewal commissions or other deferred commissions to any incorporated insurance agency solely because any of its stockholders has ceased to hold a license to act as an insurance agent.
(2) No such licensee shall share a commission with any corporation unless such corporation is an insurance agency.
(3) A general lines agent may share commissions derived from the sale of crop hail or multiple-peril crop insurance with a production credit association organized under 12 U.S.C.A. ss. 2071-2077 or a federal land bank association organized under U.S.C.A. ss. 2091-2098 if the association has specifically approved the insurance activity by its employees. The amount of commission to be shared shall be determined by the general lines agent and the company paying the commission.
(4) In addition to other penalties provided therefor, the license of any licensee violating or participating in the violation of this section shall be revoked.
History.—s. 277, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 239, 241, 807, 810, ch. 82-243; s. 2, ch. 83-54; ss. 91, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 258, ch. 97-102; s. 85, ch. 2003-1; s. 49, ch. 2003-267; s. 42, ch. 2003-281; s. 7, ch. 2004-374.
626.754 Rights of agent following termination of appointment.—
(1) Following the termination of his or her agency appointment as to an insurer, the agent may for the period herein provided continue to service, and receive from the insurer commissions or other compensation relative to, policies written by him or her for the insurer during the existence of the appointment. The agent may countersign all certificates or endorsements necessary to continue such policies to the expiration date thereof, including renewal option periods, and collect and remit premiums due thereon, but shall not otherwise, except with the consent of the insurer, change or modify the policy in any way nor increase the hazards insured against therein.
(2) This section does not apply as to agents of direct writing insurers or to agents and insurers between whom the relationship of employer and employee exists.
History.—s. 278, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 240, 241, 807, 810, ch. 82-243; ss. 92, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 259, ch. 97-102.
PART III
LIFE INSURANCE AGENTS626.776 Short title.
626.777 Scope of this part.
626.778 This part supplements licensing law.
626.779 “Life agent” defined.
626.780 “Life insurer” defined.
626.781 “Ordinary class insurer” and “ordinary-variable contract class insurer” defined.
626.782 “Industrial class insurer” defined.
626.783 “Ordinary-combination class insurer” defined.
626.784 Purpose of license.
626.7845 Prohibition against unlicensed transaction of life insurance.
626.785 Qualifications for license.
626.7851 Requirement as to knowledge, experience, or instruction.
626.788 United States Department of Veterans Affairs employees disqualified.
626.789 Military service; special provisions.
626.792 Nonresident agents; licensing and restrictions.
626.793 Excess or rejected business.
626.794 Unlawful payment or sharing of commissions.
626.795 Corporations, liability of agent.
626.796 Representing another insurer in same industrial debit territory.
626.797 Code of ethics.
626.798 Life agent as beneficiary; prohibition.
626.776 Short title.—This part may be referred to in any legal proceedings as the “Life Agents Law.”
History.—s. 281, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.777 Scope of this part.—This part applies only to agents of life insurers, agents who are appointed by the same insurer as to both life insurance and health insurance, and agents who perform the functions of a viatical settlement broker as defined in s. 626.9911.
History.—s. 280, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 242, 257, 807, 810, ch. 82-243; ss. 93, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 12, ch. 2005-237.
626.778 This part supplements licensing law.—This part is supplementary to part I, the “Licensing Procedures Law.”
History.—s. 282, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.779 “Life agent” defined.—For the purposes of this part, a “life agent” is as defined in s. 626.015.
History.—s. 283, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 28, ch. 2002-206.
626.780 “Life insurer” defined.—For the purposes of this part, a “life insurer” means an insurer writing life insurance, fixed-dollar annuity contracts, variable contracts, or any of such types of contracts.
History.—s. 284, ch. 59-205; s. 8, ch. 61-441; s. 3, ch. 73-31; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.781 “Ordinary class insurer” and “ordinary-variable contract class insurer” defined.—
(1) An “ordinary class insurer” is an insurer writing life insurance on the legal reserve plan, for amounts of $1,000 or more, with premiums payable on the annual, semiannual, quarterly, monthly, or weekly basis.
(2) An “ordinary-variable contract class insurer” is an insurer writing an ordinary class of insurance which insurer issues life insurance or annuity contracts providing for payments or values which vary directly according to investment experience.
History.—s. 285, ch. 59-205; s. 18, ch. 61-441; s. 4, ch. 73-31; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.782 “Industrial class insurer” defined.—An “industrial class insurer” is an insurer writing industrial life insurance, as defined in s. 627.502, and as to such insurance operates under a system of collecting a debit by its agent.
History.—s. 286, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.783 “Ordinary-combination class insurer” defined.—An “ordinary-combination class insurer” is an insurer writing both ordinary class insurance and industrial class insurance.
History.—s. 287, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 243, 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.784 Purpose of license.—
(1) The purpose of a license issued under this code to a life agent is to authorize and enable the licensee actively and in good faith to engage in the insurance business as such an agent with respect to the general public and to facilitate the public supervision of such activities in the public interest, and not for the purpose of enabling the licensee to receive an unlawful rebate of premium in the form of commission or other compensation as an agent or enabling the licensee to receive commissions or other compensation based upon insurance solicited or procured by or through the licensee upon his or her own interests or upon those of other persons with whom he or she is closely associated in capacities other than as an insurance agent.
(2) The department shall not grant, renew, continue, or permit to exist any license or appointment of a life agent if it finds that such licensee or appointee obtained, or attempted to obtain, such license or appointment not for the purpose of holding himself or herself out to the general public as a life insurance agent but principally for the purpose of soliciting, negotiating, or procuring controlled business. As used in this section, “controlled business” means life insurance or annuity contracts covering himself or herself or family members; officers, directors, stockholders, partners, or employees of a business in which he or she or a family member is engaged; or the debtors of a firm, association, or corporation of which he or she is an officer, director, stockholder, partner, or employee.
(3) A violation of this section shall be deemed to exist, or be probable (as to an applicant for appointment), if the department finds that during a 12-month period the premium writings represented by such controlled business insurance contracts signed, issued, or sold by the licensee or appointee have been or, in the case of an applicant for appointment, probably will be under circumstances found by the department to exist, in excess of premium writings during the same period by the licensee or appointee or proposed licensee or appointee as represented by life insurance contracts to the general public other than the classes of persons classified as controlled business.
(4) This section shall not be deemed to prohibit the licensing and appointing of any person employed by or associated with a lending or financing institution or creditor, with respect to insurance only, under credit life or disability insurance policies which are subject to part IX of chapter 627, of borrowers from such institution.
History.—s. 288, ch. 59-205; s. 1, ch. 61-360; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 244(1st), 257, 807, 810, ch. 82-243; ss. 94, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 260, ch. 97-102.
626.7845 Prohibition against unlicensed transaction of life insurance.—
(1) An individual may not solicit or sell variable life insurance, variable annuity contracts, or any other indeterminate value or variable contract as defined in s. 627.8015, unless the individual has successfully completed a licensure examination relating to variable annuity contracts authorized and approved by the department.
(2) Except as provided in s. 626.112(6), with respect to any line of authority specified in s. 626.015(10), no individual shall, unless licensed as a life agent:
(a) Solicit insurance or annuities or procure applications;
(b) In this state, engage or hold himself or herself out as engaging in the business of analyzing or abstracting insurance policies or of counseling or advising or giving opinions to persons relative to insurance or insurance contracts other than:
1. As a consulting actuary advising an insurer; or
2. As to the counseling and advising of labor unions, associations, trustees, employers, or other business entities, the subsidiaries and affiliates of each, relative to their interests and those of their members or employees under insurance benefit plans; or
(c) In this state, from this state, or with a resident of this state, offer or attempt to negotiate on behalf of another person a viatical settlement contract as defined in s. 626.9911.
History.—s. 29, ch. 2002-206; s. 963, ch. 2003-261; s. 112, ch. 2004-5; s. 13, ch. 2005-237.
626.785 Qualifications for license.—
(1) The department shall not grant or issue a license as life agent to any individual found by it to be untrustworthy or incompetent, or who does not meet the following qualifications:
(a) Must be a natural person of at least 18 years of age.
(b) Must be a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and a bona fide resident of this state.
(c) Must not be an employee of the United States Department of Veterans Affairs or state service office, as referred to in s. 626.788.
(d) Must not be a funeral director or direct disposer, or an employee or representative thereof, or have an office in, or in connection with, a funeral establishment, except that a funeral establishment may contract with a life insurance agent to sell a preneed contract as defined in s. 497.005. Notwithstanding other provisions of this chapter, such insurance agent may sell limited policies of insurance covering the expense of final disposition or burial of an insured in the amount of $12,500, plus an annual percentage increase based on the Annual Consumer Price Index compiled by the United States Department of Labor, beginning with the Annual Consumer Price Index announced by the United States Department of Labor for the year 2003.
(e) Must take and pass any examination for license required under s. 626.221.
(f) Must be qualified as to knowledge, experience, or instruction in the business of insurance and meet the requirements relative thereto provided in s. 626.7851.
(2) An individual who is a bona fide resident of this state shall be deemed to meet the residence requirement of paragraph (1)(b), notwithstanding the existence at the time of application for license of a license in his or her name on the records of another state as a resident licensee of such other state, if the applicant furnishes a letter of clearance satisfactory to the department that the resident licenses have been canceled or changed to a nonresident basis and that he or she is in good standing.
(3) Notwithstanding any other provisions of this chapter, a funeral director, a direct disposer, or an employee of a funeral establishment that holds a certificate of authority pursuant to s. 497.452 may obtain an agent’s license to sell only policies of life insurance covering the expense of a prearrangement for funeral services or merchandise so as to provide funds at the time the services and merchandise are needed. The face amount of insurance covered by any such policy shall not exceed $12,500, plus an annual percentage increase based on the Annual Consumer Price Index compiled by the United States Department of Labor, beginning with the Annual Consumer Price Index announced by the United States Department of Labor for 2003.
History.—s. 289, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-116; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 245(1st), 257, 807, 810, ch. 82-243; s. 1, ch. 84-196; s. 4, ch. 85-67; s. 1, ch. 86-246; s. 20, ch. 88-166; ss. 95, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 30, ch. 93-268; s. 115, ch. 93-399; s. 261, ch. 97-102; s. 30, ch. 2002-206; s. 50, ch. 2003-267; s. 43, ch. 2003-281; s. 113, ch. 2004-5; s. 147, ch. 2004-301; s. 52, ch. 2005-155.
626.7851 Requirement as to knowledge, experience, or instruction.—No applicant for a license as a life agent, except for a chartered life underwriter (CLU), shall be qualified or licensed unless within the 4 years immediately preceding the date the application for a license is filed with the department he or she has:
(1) Successfully completed 40 hours of classroom courses in insurance, 3 hours of which shall be on the subject matter of ethics, satisfactory to the department at a school or college, or extension division thereof, or other authorized course of study, approved by the department. Courses must include instruction on the subject matter of unauthorized entities engaging in the business of insurance, to include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as it relates to the provision of life insurance by employers to their employees and the regulation thereof;
(2) Successfully completed a correspondence course in insurance, 3 hours of which shall be on the subject matter of ethics, satisfactory to the department and regularly offered by accredited institutions of higher learning in this state or by independent programs of study, approved by the department. Courses must include instruction on the subject matter of unauthorized entities engaging in the business of insurance, to include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as it relates to the provision of life insurance by employers to their employees and the regulation thereof;
(3) Held an active license in life, or life and health, insurance in another state. This provision may not be utilized unless the other state grants reciprocal treatment to licensees formerly licensed in Florida; or
(4) Been employed by the department or office for at least 1 year, full time in life or life and health insurance regulatory matters and who was not terminated for cause, and application for examination is made within 90 days after the date of termination of his or her employment with the department or office.
History.—ss. 244(2nd), 807, ch. 82-243; ss. 96, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 21, ch. 92-146; s. 262, ch. 97-102; s. 31, ch. 2002-206; s. 964, ch. 2003-261; s. 51, ch. 2003-267; s. 44, ch. 2003-281; s. 2(2nd), ch. 2007-199.
626.788 United States Department of Veterans Affairs employees disqualified.—No person employed by the United States Department of Veterans Affairs or state service office shall be licensed as a life agent. The license of any person who accepts such employment shall automatically terminate when the employment commences.
History.—s. 292, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 31, ch. 93-268.
626.789 Military service; special provisions.—Any person who obtains a license and appointment as a life agent who is in the Armed Forces of the United States shall maintain records, claim, and information facilities at a location readily accessible to the public at a location not attached to or on any military installation. Any such agent may not sell any insurance policies, contracts, or certificates to any active duty military person or the family of such person if the buyer or proposed insured is of a lower rank or pay grade.
History.—s. 293, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 246, 257, 807, 810, ch. 82-243; s. 1, ch. 85-67; ss. 97, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.792 Nonresident agents; licensing and restrictions.—
(1) The department, upon written application and payment of the fees specified in s. 624.501, may issue a license as a nonresident life agent to an individual not resident of this state, upon compliance with the applicable provisions of this code, if that individual’s home state or province of Canada will accord the same privilege to a resident of this state.
(2) The department may enter into reciprocal agreements with the appropriate official of any other state or province of Canada waiving the written examination of any applicant resident in such other state or province if, in that other state or province, a resident of this state is privileged to procure a life insurance agent’s license upon the foregoing conditions and without discrimination as to fees or otherwise in favor of the residents of such other state or province and:
(a) A written examination, substantially equivalent to the examination required by this state, is required of an applicant for a life insurance agent’s license in such other state or province.
(b) The appropriate official of the other state or province certifies that the applicant holds a currently valid license as a life insurance agent in such other state or province and satisfies the examination requirement under s. 626.221 or is exempt under such section.
(3) If the laws of another state or province of Canada require the sharing of commissions with resident agents of that state or province on applications for life insurance, or for life insurance including health insurance, written by nonresident agents, then the same provisions shall apply when resident agents of that state or province, licensed as nonresident agents of this state, write applications for insurance on residents of this state.
(4) The department shall not issue a nonresident life insurance agent’s license to any nonresident who at the time of issuance and throughout the existence of the Florida license does not hold a resident license as life agent issued by the nonresident’s state or province of Canada.
(5) The licensee shall, throughout the existence of the Florida nonresident life license and appointment, hold a license as a resident life agent in his or her state of residence. The authority of the nonresident license is limited to the specific lines of authority granted in the license issued by the agent’s state of residence and further limited to the specific lines authorized under the nonresident license issued by this state.
(6) Any individual who holds a Florida nonresident agent’s license, upon becoming a resident of this state may, for a period not to exceed 90 days, continue to transact insurance in this state under the nonresident license and appointment. Such individual must make application for resident licensure and must become licensed as a resident agent within 90 days after becoming a resident of this state.
(7) Upon becoming a resident of this state, an individual who holds a Florida nonresident agent’s license is no longer eligible for licensure as a nonresident agent if such individual fails to make application for a resident license and become licensed as a resident agent within 90 days. His or her license and any appointments shall be canceled immediately. He or she may apply for a resident license pursuant to s. 626.785.
(8) If available, the department shall verify the nonresident applicant’s licensing status through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries.
History.—s. 296, ch. 59-205; s. 3, ch. 63-20; s. 2, ch. 67-91; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 252, 257, 807, 810, ch. 82-243; s. 22, ch. 88-166; ss. 100, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 265, ch. 97-102; s. 42, ch. 98-199; s. 41, ch. 99-7; s. 14, ch. 2001-142; s. 33, ch. 2002-206; s. 8, ch. 2004-374.
626.793 Excess or rejected business.—
(1) A licensed life agent may place excess or rejected risks within the class of business for which he or she is licensed and appointed, and which the insurer appointing him or her is authorized to transact, with any other authorized insurer without being required to secure an appointment as to such other insurer.
(2) “Excess business” is that portion of a risk above the limits of that which the agent’s own insurer will accept.
(3) “Rejected business” is a risk that the agent’s own insurer is authorized to write but rejects for underwriting reasons, or is willing to accept only on a substandard basis; but which business will be accepted and issued by another authorized insurer at a lower rate.
(4) Within 15 days after the last day of each month, any insurer accepting business under this section shall report to the department the name, address, telephone number, and social security number of each agent from which the insurer received more than 24 risks during the calendar year. Once the insurer has reported an agent’s name to the department pursuant to this subsection, additional reports on the same agent shall not be required. However, the fee set forth in s. 624.501 shall be paid for the agent by the insurer for each year until the insurer notifies the department that the insurer is no longer accepting business from the agent pursuant to this section. The insurer may require that the agent reimburse the insurer for the fee.
(5) If a managing general agent handles or an insurer accepts business under this section, relative to that business:
(a) The insurer shall be liable to the insured for coverage arising hereunder and for the acts of the agent in producing their business; and
(b) The managing general agent or insurer shall be responsible and accountable for any violation of this code by the producing agent, and the violation shall be deemed to be a violation of the code by the managing general agent or insurer if the managing general agent or insurer knew of or encouraged, aided, or abetted in the agent’s violation.
History.—s. 297, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 253, 257, 807, 810, ch. 82-243; ss. 101, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 266, ch. 97-102.
626.794 Unlawful payment or sharing of commissions.—
(1) No life insurer or licensed life agent shall pay directly or indirectly any commission or other valuable consideration to any person for services as a life insurance agent within this state, unless such person holds a currently valid license and appointment to act as a life insurance agent as required by the laws of this state; except that a life insurer may pay such commission or other valuable consideration to, and a licensed and appointed life insurance agent may share any commission or other valuable consideration with, an incorporated insurance agency in which all employees, stockholders, directors, or officers who solicit, negotiate, or effectuate life insurance contracts are qualified life insurance agents holding currently valid licenses and appointments.
(2) No person other than a licensed and appointed life agent shall accept any such commission or other valuable consideration, except as provided in subsection (1).
(3) This section shall not prevent the payment or receipt of renewal or other deferred commissions or pensions to or by any person solely because such person has ceased to hold a license or appointment to act as a life insurance agent and shall not prevent the payment of renewal or other deferred commissions to any incorporated insurance agency solely because any of its stockholders has ceased to hold a license or appointment to act as a life insurance agent.
History.—s. 298, ch. 59-205; s. 1, ch. 63-381; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 254, 257, 807, 810, ch. 82-243; ss. 102, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.795 Corporations, liability of agent.—Any life insurance agent who is an officer, director, or stockholder of an incorporated life insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provisions of this code committed by such licensee or by any person under his or her direct supervision and control while acting on behalf of the corporation. Nothing in this section shall be construed to render any person criminally liable or subject to any disciplinary proceedings for any act unless such person personally committed or knew or should have known of such act and of the facts constituting a violation of this chapter.
History.—s. 5, ch. 63-20; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 257, 807, 810, ch. 82-243; ss. 103, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 267, ch. 97-102.
626.796 Representing another insurer in same industrial debit territory.—
(1) No insurer shall employ or appoint to sell weekly premium or industrial insurance in a given debit territory any agent who has within the preceding 6 months sold insurance for another insurer in the same or any part of the same debit territory, unless prior to employment the written approval of the previous insurer is obtained.
(2) This section shall not be construed as preventing such an individual from representing another insurer in a different debit territory.
History.—s. 299, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 255, 257, 807, 810, ch. 82-243; ss. 104, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.797 Code of ethics.—
(1) The department shall, after consultation with the Florida Association of Insurance and Financial Advisors, adopt a code of ethics, or continue any such code heretofore so adopted, to govern the conduct of life agents in their relations with the public, other agents, and the insurers.
(2) The code of ethics shall apply standards of conduct designed to avoid the commission of acts or the existence of circumstances which would constitute grounds for suspension, revocation, or refusal of license under ss. 626.611 and 626.621 and to avoid the use of unfair trade practices and unfair methods of competition which would be in violation of any provision of part IX.
(3) All applicants for license as life agents shall subscribe to the code of ethics.
History.—s. 300, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 256, 257, 807, 810, ch. 82-243; s. 21, ch. 87-226; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 48, ch. 2001-63; s. 64, ch. 2003-267; s. 57, ch. 2003-281.
626.798 Life agent as beneficiary; prohibition.—No life agent shall, with respect to the placement of life insurance coverage with a life insurer covering the life of a person who is not a family member of the agent, handle in his or her capacity as a life agent the placement of such coverage when the agent placing the coverage or a family member of such agent is the named beneficiary under the life insurance policy, unless the life agent or family member has an insurable interest in the life of such person. However, the agent or a family member of such agent may not be designated as a trustee or guardian or be granted power of attorney unless he or she is a family member of the policy owner or insured, or is a bank or trust company duly authorized to act as a fiduciary. For the purposes of this section, the phrase “not a family member,” with respect to a life agent, means an individual who is not related to the life agent as father, mother, son, daughter, brother, sister, grandfather, grandmother, uncle, aunt, first cousin, nephew, niece, husband, wife, father-in-law, mother-in-law, brother-in-law, sister-in-law, stepfather, stepmother, stepson, stepdaughter, stepbrother, stepsister, half brother, or half sister. For the purposes of this section, the term “insurable interest” means that the life agent has an actual, lawful, and substantial economic interest in the safety and preservation of the life of the insured or a reasonable expectation of benefit or advantage from the continued life of the insured.
History.—ss. 1, 2, ch. 89-257; ss. 105, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 268, ch. 97-102; s. 49, ch. 2010-175.
PART IV
HEALTH INSURANCE AGENTS626.826 Short title.
626.827 Scope of this part.
626.828 This part supplements licensing law.
626.829 “Health agent” defined.
626.830 Purpose of license.
626.8305 Prohibition against the unlicensed transaction of health insurance.
626.831 Qualifications for license.
626.8311 Requirement as to knowledge, experience, or instruction.
626.833 United States Department of Veterans Affairs employees disqualified.
626.834 Military service; special provisions.
626.835 Nonresident agents; licensing and restrictions.
626.836 Nonresident agents; service of process.
626.837 Excess or rejected business.
626.8373 Overinsurance of health insurance coverage.
626.838 Unlawful payment or sharing of commissions.
626.839 Corporations, liability of agent.
626.826 Short title.—This part may be referred to in any legal proceedings as the “Health Agent Law.”
History.—s. 302, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 258, 271, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.827 Scope of this part.—
(1) This part applies only to agents of health insurers, which agents are not appointed as to the same insurer as to either life insurance or as to property, casualty, or surety insurance.
(2) Agents appointed as to the same insurer as to both life insurance and health insurance are deemed to be life agents and are not subject to this part, but are subject to part I (Licensing Procedures Law) and part III (Life Agents Law).
(3) Agents appointed as to the same insurer as to both health insurance and property or casualty or surety insurance are deemed as to be general lines agents and are not subject to this part, but are subject to part I (Licensing Procedures Law) and part II (General Lines Agent Law).
(4) All agents subject to this chapter are “health agents” as defined in s. 626.829.
History.—s. 301, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 259, 271, 807, 810, ch. 82-243; s. 44, ch. 83-215; ss. 106, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.828 This part supplements licensing law.—This part is supplementary to part I, the “Licensing Procedures Law.”
History.—s. 303, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 271, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.829 “Health agent” defined.—
(1) A “health agent” is any person appointed as agent by an insurer to solicit applications for or to negotiate and effectuate contracts of health insurance, as such insurance is defined in s. 624.603.
(2) Any person who acts for an insurer, or on behalf of a licensed representative of an insurer, to solicit applications for or to negotiate and effectuate health insurance contracts, whether or not he or she is appointed as an agent, subagent, or canvasser or by any other title, shall be deemed to be a health agent and shall be qualified, licensed, and appointed as a health agent.
History.—s. 304, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 260, 271, 807, 810, ch. 82-243; ss. 107, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 269, ch. 97-102; s. 86, ch. 2003-1; s. 52, ch. 2003-267; s. 45, ch. 2003-281.
626.830 Purpose of license.—
(1) The purpose of a license issued under this code to a health agent is to authorize and enable the licensee actively and in good faith to engage in the insurance business as such an agent with respect to the general public and to facilitate the public supervision of such activities in the public interest, and not for the purpose of enabling the licensee to receive an unlawful rebate of premium in the form of commission or other compensation as an agent or enabling the licensee to receive commissions or other compensation based upon insurance solicited or procured by or through the licensee upon his or her own interests or upon those of other persons with whom he or she is closely associated in capacities other than as an insurance agent.
(2) The department shall not grant, renew, continue, or permit to exist any license or appointment as a health agent as to any applicant therefor or licensee or appointee thereunder if it finds that the license or appointment has been or is being or will be used by the applicant, licensee, or appointee not for the purpose of holding himself or herself out to the general public as a health agent, but principally for the purpose of soliciting, negotiating, handling or procuring “controlled business,” that is, health insurance covering himself or herself or family members; the officers, directors, stockholders, partners, employees, or debtors of a partnership, association, or corporation of which he or she or a family member is an officer, director, stockholder, partner, or employee; or members of an association of which he or she is a director, officer, or employee.
(3) A violation of this section shall be deemed to exist or be probable if the department finds that during a 12-month period the premium writings represented by such controlled business insurance contracts signed, countersigned, issued, or sold by the licensee have been, or in the case of an applicant for appointment, probably will be under circumstances found by the department to exist, in excess of premium writings during the same period by the appointee or proposed appointee as represented by health insurance contracts to the general public other than the classes of persons above classified as controlled business.
(4) This section shall not be deemed to prohibit the licensing and appointing of any person employed by or associated with a lending or financing institution, with respect to insurance only, under credit life or disability insurance policies of borrowers from such institution or creditor.
History.—s. 305, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 261, 271, 807, 810, ch. 82-243; ss. 108, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 270, ch. 97-102.
626.8305 Prohibition against the unlicensed transaction of health insurance.—Except as provided in s. 626.112(6), with respect to any line of authority specified in s. 626.015(6), no individual shall, unless licensed as a health agent:
(1) Solicit insurance or procure applications; or
(2) In this state, engage or hold himself or herself out as engaging in the business of analyzing or abstracting insurance policies or of counseling or advising or giving opinions to persons relative to insurance contracts other than:
(a) As a consulting actuary advising insurers; or
(b) As to the counseling and advising of labor unions, associations, trustees, employers, or other business entities, the subsidiaries and affiliates of each, relative to their interests and those of their members or employees under insurance benefit plans.
History.—s. 34, ch. 2002-206; s. 965, ch. 2003-261; s. 114, ch. 2004-5.
626.831 Qualifications for license.—
(1) The department shall not grant or issue a license as health agent as to any individual found by it to be untrustworthy or incompetent, or who does not meet the following qualifications:
(a) Must be a natural person of at least 18 years of age.
(b) Must be a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and a bona fide resident of this state.
(c) Must not be an employee of the United States Department of Veterans Affairs or state service office, as referred to in s. 626.833.
(d) Must take and pass any examination for license required under s. 626.221.
(e) Must be qualified as to knowledge, experience, or instruction in the business of insurance and meet the requirements relative thereto provided in s. 626.8311.
(2) An individual who is a bona fide resident of this state shall be deemed to meet the residence requirement of paragraph (1)(b), notwithstanding the existence at the time of application for license of a license in his or her name on the records of another state as a resident licensee of such other state, if the applicant furnishes a letter of clearance satisfactory to the department that the resident licenses have been canceled or changed to a nonresident basis and that he or she is in good standing.
History.—s. 306, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-116; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 262(1st), 271, 807, 810, ch. 82-243; s. 5, ch. 85-67; s. 23, ch. 88-166; ss. 109, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 32, ch. 93-268; s. 271, ch. 97-102; s. 53, ch. 2003-267; s. 46, ch. 2003-281; s. 115, ch. 2004-5.
626.8311 Requirement as to knowledge, experience, or instruction.—No applicant for a license as a health agent, except for a chartered life underwriter (CLU), shall be qualified or licensed unless within the 4 years immediately preceding the date the application for license is filed with the department he or she has:
(1) Successfully completed 40 hours of classroom courses in insurance, 3 hours of which shall be on the subject matter of ethics, satisfactory to the department at a school or college, or extension division thereof, or other authorized course of study, approved by the department. Courses must include instruction on the subject matter of unauthorized entities engaging in the business of insurance, to include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as it relates to the provision of health insurance by employers to their employees and the regulation thereof;
(2) Successfully completed a correspondence course in insurance, 3 hours of which shall be on the subject matter of ethics, satisfactory to the department and regularly offered by accredited institutions of higher learning in this state or by independent programs of study, approved by the department. Courses must include instruction on the subject matter of unauthorized entities engaging in the business of insurance, to include the Florida Nonprofit Multiple-Employer Welfare Arrangement Act and the Employee Retirement Income Security Act, 29 U.S.C. ss. 1001 et seq., as it relates to the provision of health insurance by employers to their employees and the regulation thereof;
(3) Held an active license in health, or life and health, insurance in another state. This provision may not be utilized unless the other state grants reciprocal treatment to licensees formerly licensed in Florida; or
(4) Been employed by the department or office for at least 1 year, full time in health insurance regulatory matters and who was not terminated for cause, and application for examination is made within 90 days after the date of termination of his or her employment with the department or office.
History.—ss. 110, 207, ch. 90-363; s. 4, ch. 91-429; s. 22, ch. 92-146; s. 272, ch. 97-102; s. 35, ch. 2002-206; s. 966, ch. 2003-261; s. 54, ch. 2003-267; s. 47, ch. 2003-281; s. 3, ch. 2007-199.
626.833 United States Department of Veterans Affairs employees disqualified.—No person employed by the United States Department of Veterans Affairs or the Department of Veterans’ Affairs shall be licensed as a health agent. The license of any person who accepts such employment will automatically terminate when the employment commences.
History.—s. 308, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 264, 271, 807, 810, ch. 82-243; s. 20, ch. 84-114; s. 29, ch. 88-290; ss. 111, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 33, ch. 93-268.
626.834 Military service; special provisions.—Any person who obtains a license and appointment as a health agent who is in the Armed Forces of the United States shall maintain records, claim, and information facilities at a location readily accessible to the public at a location not attached to or on any military installation. Any such agent may not sell any insurance policies, contracts, or certificates to any active duty military person or the family of such person if the buyer or proposed insured is of a lower rank or pay grade.
History.—s. 309, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 262(2nd), 271, 807, 810, ch. 82-243; s. 2, ch. 85-67; ss. 112, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.835 Nonresident agents; licensing and restrictions.—
(1) The department, upon written application and payment of the fees specified in s. 624.501, may issue a license as a nonresident health agent to an individual not a resident of this state, if the state or province of Canada of such individual’s residence will accord the same privilege to a resident of this state.
(2) The department may enter into reciprocal agreements with the appropriate official of any other state or province of Canada waiving the written examination of any applicant resident in such other state or province if, in such other state or province, a resident of this state is privileged to procure a health insurance agent’s license upon the foregoing conditions and without discrimination as to fees or otherwise in favor of the residents of such other state or province and:
(a) A written examination, substantially equivalent to the examination required by this state, is required of an applicant for a health insurance agent’s license in such other state or province.
(b) The appropriate official of the other state or province certifies that the applicant holds a currently valid license as a health insurance agent in such other state or province and satisfied the examination requirements under s. 626.221 or is exempt under such section.
(3) If the laws of another state or province of Canada require the sharing of commissions with resident agents of that state or province on applications for health insurance written by nonresident agents, then the same provisions shall apply when resident agents of that state or province, licensed as nonresident agents of this state, write applications for insurance on residents of this state.
(4) The department shall not issue a nonresident health insurance agent’s license to any nonresident who at the time of issuance and throughout the existence of the Florida license does not hold a resident license as health agent issued by the nonresident’s state or province of Canada.
(5) The licensee shall, throughout the existence of his or her Florida nonresident health license and appointment, hold a license as a resident health agent in his or her state of residence. The authority of the nonresident license is limited to the specific lines of authority granted in the license issued by the agent’s state of residence and further limited to the specific lines authorized under the nonresident license issued by this state.
(6) Any individual who holds a Florida nonresident agent’s license, upon becoming a resident of this state may, for a period not to exceed 90 days, continue to transact insurance in this state under the nonresident license and appointment. Such individual must make application for resident licensure and must become licensed as a resident agent within 90 days of becoming a resident of this state.
(7) Upon becoming a resident of this state, an individual who holds a Florida nonresident agent’s license is no longer eligible for licensure as a nonresident agent if such individual fails to make application for a resident license and become licensed as a resident agent within 90 days. His or her license and any appointments shall be canceled immediately. The individual may apply for a resident license pursuant to s. 626.831.
(8) If available, the department shall verify the producer’s licensing status through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries.
History.—s. 310, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 263(2nd), 271, 807, 810, ch. 82-243; s. 89, ch. 83-216; s. 24, ch. 88-166; ss. 113, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 273, ch. 97-102; s. 43, ch. 98-199; s. 15, ch. 2001-142; s. 36, ch. 2002-206; s. 9, ch. 2004-374.
626.836 Nonresident agents; service of process.—The provisions of s. 626.742 also apply as to nonresident health insurance agents licensed by the department.
History.—s. 311, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 267, 271, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.837 Excess or rejected business.—
(1) A licensed health agent may place excess or rejected risks within the class of business for which he or she is licensed and appointed, and which the insurer appointing the agent is authorized to transact, with any other authorized insurer without being required to secure an appointment as to such other insurer, but subject to the agent’s agreement with the insurer appointing him or her.
(2) “Excess business” is that portion of a risk above the limits of that which the agent’s own insurer will accept.
(3) “Rejected business” is a risk that the agent’s own insurer is authorized to write but rejects for underwriting reasons, or is willing to accept only on a substandard basis; but which business will be accepted and issued by another authorized insurer at a lower rate.
(4) This section shall be construed to permit an agent properly licensed and appointed by the department to broker business with another licensed and appointed agent in this state when:
(a) Both agents are licensed and appointed for the class of business involved;
(b) The agent to whom the risk is brokered is appointed by the issuing insurer;
(c) The brokerage arrangement is desired; and
(d) The brokerage arrangement is in the best interest of the insured.
(5) Within 15 days after the last day of each month, any insurer accepting business under this section shall report to the department the name, address, telephone number, and social security number of each agent from which the insurer received more than 24 risks during the calendar year. Once the insurer has reported pursuant to this subsection an agent’s name to the department, additional reports on the same agent shall not be required. However, the fee set forth in s. 624.501 shall be paid for the agent by the insurer for each year until the insurer notifies the department that the insurer is no longer accepting business from the agent pursuant to this section. The insurer may require that the agent reimburse the insurer for the fee.
(6) If a managing general agent handles or an insurer accepts business under this section, relative to that business:
(a) The insurer shall be liable to the insured for coverage arising hereunder and for the acts of the agent in producing their business; and
(b) The managing general agent or insurer shall be responsible and accountable for any violation of this code by the producing agent, and the violation shall be deemed to be a violation of the code by the managing general agent or insurer if the managing general agent or insurer knew of or encouraged, aided, or abetted in the agent’s violation.
History.—s. 312, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 268, 271, 807, 810, ch. 82-243; ss. 114, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 23, ch. 92-146; s. 274, ch. 97-102; s. 44, ch. 98-199.
626.8373 Overinsurance of health insurance coverage.—
(1) With respect to the solicitation and sale of health insurance, continuing care contracts pursuant to chapter 651, health maintenance contracts pursuant to part II of chapter 641, or Medicare supplement insurance, an agent shall ask each person solicited whether he or she is currently covered under a health insurance policy, continuing care contract, health maintenance, or Medicare supplement insurance policy. The agent shall explain to each person the extent to which the proposed coverage will overlap or duplicate the existing coverage after considering any applicable coordination of benefits provisions under the existing or proposed health coverage if the person solicited has a copy of his or her current policy for the agent to review or if the person’s current policy is with the same insurer as the proposed replacement policy.
(2) The department may by rule prescribe such acknowledgment and information forms as it deems necessary or advisable to protect consumers from uninformed buying of overlapping, duplicative, or significantly different coverages. The department may require agents or insurers to have such forms signed by applicants when an application is taken or before an application is processed, and to retain such forms thereafter in the agent’s and insurer’s files.
History.—s. 59, ch. 89-360; ss. 115, 207, ch. 90-363; s. 4, ch. 91-429; s. 24, ch. 92-146; s. 275, ch. 97-102.
626.838 Unlawful payment or sharing of commissions.—
(1) No health insurer or licensed health agent shall pay directly or indirectly any commission or other valuable consideration to any person for services as a health insurance agent within this state, unless such person holds a currently valid license and appointment to act as a health insurance agent as required by the laws of this state; except that a health insurer may pay such commission or other valuable consideration to, and a licensed and appointed health insurance agent may share any commission or other valuable consideration with, an incorporated insurance agency in which all employees, stockholders, directors, or officers who solicit, negotiate, or effectuate health insurance contracts are qualified health insurance agents holding currently valid licenses and appointments.
(2) No person other than a licensed and appointed health agent shall accept any such commission or other valuable consideration, except as provided in subsection (1).
(3) This section shall not prevent the payment or receipt of renewal or other deferred commissions or pensions to or by any person solely because such person has ceased to hold a license or appointment to act as a health insurance agent and shall not prevent the payment of renewal or other deferred commissions to any incorporated insurance agency solely because any of its stockholders has ceased to hold a license or appointment to act as a health insurance agent.
History.—s. 313, ch. 59-205; s. 2, ch. 63-381; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 269(1st), 271, 807, 810, ch. 82-243; ss. 116, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.839 Corporations, liability of agent.—Any health insurance agent who is an officer, director, or stockholder of an incorporated health insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provisions of this code committed by such licensee or by any person under his or her direct supervision and control while acting on behalf of the corporation. Nothing in this section shall be construed to render any person criminally liable or subject to any disciplinary proceedings for any act unless such person personally committed or knew or should have known of such act and of the facts constituting a violation of this chapter.
History.—s. 6, ch. 63-20; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 3, ch. 81-282; ss. 2, 3, ch. 81-318; ss. 270(1st), 271, 807, 810, ch. 82-243; ss. 117, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 276, ch. 97-102.
PART V
TITLE INSURANCE AGENTS626.841 Definitions.
626.8411 Application of Florida Insurance Code provisions to title insurance agents or agencies.
626.8412 License and appointments required.
626.8413 Title insurance agents; certain names prohibited.
626.8414 Qualifications for examination.
626.8417 Title insurance agent licensure; exemptions.
626.8418 Application for title insurance agency license.
626.8419 Appointment of title insurance agency.
626.84195 Confidentiality of information supplied by title insurance agencies and insurers.
626.842 Credit and character reports.
626.84201 Nonresident title insurance agents.
626.8421 Number of appointments permitted or required.
626.8423 Investigation of applicants for license or renewal or continuation.
626.8427 Number of applications for licensure required; exemption; effect of expiration of license.
626.843 Renewal, continuation, reinstatement, termination of title insurance agent’s appointment.
626.8433 Filing of reasons for terminating appointment of title insurance agent; confidential information.
626.8437 Grounds for denial, suspension, revocation, or refusal to renew license or appointment.
626.844 Grounds for discretionary refusal, suspension, or revocation of license or appointment.
626.8443 Duration of suspension or revocation.
626.8447 Effect of suspension or revocation upon other licensees, appointees.
626.845 Cancellation of license.
626.8453 Penalty for violation.
626.8457 Administrative fine in lieu of suspension or revocation of license or appointment.
626.846 Probation.
626.8463 Witnesses and evidence.
626.8467 Testimony compelled; immunity from prosecution.
626.847 Penalty for refusal to testify.
626.8473 Escrow; trust fund.
626.841 Definitions.—The term:
(1) “Title insurance agent” means a person appointed in writing by a title insurer to issue and countersign commitments or policies of title insurance in its behalf.
(2) “Title insurance agency” means an insurance agency under which title insurance agents and other employees determine insurability in accordance with underwriting rules and standards prescribed by the title insurer represented by the agency, and issue and countersign commitments, endorsements, or policies of title insurance, on behalf of the appointing title insurer. The term does not include a title insurer.
History.—ss. 575, 809(2nd), ch. 82-243; s. 79, ch. 82-386; s. 1, ch. 86-286; ss. 11, 114, ch. 92-318; s. 3, ch. 99-286.
Note.—Former s. 627.7715.
626.8411 Application of Florida Insurance Code provisions to title insurance agents or agencies.—
(1) The following provisions of part II applicable to general lines agents or agencies also apply to title insurance agents or agencies:
(a) Section 626.734, relating to liability of certain agents.
(b) Section 626.747, relating to branch agencies.
(c) Section 626.749, relating to place of business in residence.
(d) Section 626.753, relating to sharing of commissions.
(e) Section 626.754, relating to rights of agent following termination of appointment.
(2) The following provisions of part I do not apply to title insurance agents or title insurance agencies:
(a) Section 626.112(7), relating to licensing of insurance agencies.
(b) Section 626.231, relating to eligibility for examination.
(c) Section 626.572, relating to rebating, when allowed.
(d) Section 626.172, relating to agent in full-time charge.
History.—s. 12, ch. 92-318; s. 45, ch. 98-199; s. 4, ch. 99-286; s. 37, ch. 2002-206; s. 29, ch. 2005-257; s. 85, ch. 2006-1; s. 24, ch. 2012-209.
626.8412 License and appointments required.—
(1) Except as otherwise provided in this part:
(a) Title insurance may be sold only by a licensed title insurance agent employed by a licensed title insurance agency or employed by a title insurer.
(b) A title insurance agent may not sell a title insurance policy issued by an insurer for which the agent does not hold a current appointment.
(2) Except as otherwise provided in this part, a person, other than a title insurance agency or an employee of a title insurance agency, may not perform any of the functions of a title insurance agency without a title insurance agency license.
History.—s. 13, ch. 92-318.
626.8413 Title insurance agents; certain names prohibited.—After October 1, 1985, a title insurance agent as defined in s. 626.841 shall not adopt a name which contains the words “title insurance,” “title guaranty,” or “title guarantee,” unless such words are followed by the word “agent” or “agency” in the same size and type as the words preceding them. This section does not apply to a title insurer acting as an agent for another title insurer.
History.—s. 1, ch. 85-185; s. 1, ch. 86-286; s. 114, ch. 92-318.
626.8414 Qualifications for examination.—The department must authorize any natural person to take the examination for the issuance of a license as a title insurance agent if the person meets all of the following qualifications:
(1) The applicant must be at least 18 years of age.
(2) The applicant must be a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and a bona fide resident of this state. A person meets the residency requirement of this subsection, notwithstanding the existence at the time of application for license of a license in the applicant’s name on the records of another state as a resident licensee of such other state, if the applicant furnishes a letter of clearance satisfactory to the department that the resident licenses have been canceled or changed to a nonresident basis and that the applicant is in good standing.
History.—s. 14, ch. 92-318; s. 65, ch. 99-5; s. 81, ch. 2000-154; s. 55, ch. 2003-267; s. 48, ch. 2003-281; s. 116, ch. 2004-5.
626.8417 Title insurance agent licensure; exemptions.—
(1) A person may not act as a title insurance agent as defined in s. 626.841 until a valid title insurance agent’s license has been issued to that person by the department.
(2) An application for license as a title insurance agent shall be filed with the department on printed forms furnished by the department.
(3) The department shall not grant or issue a license as title agent to any individual found by it to be untrustworthy or incompetent, who does not meet the qualifications for examination specified in s. 626.8414, or who does not meet the following qualifications:
(a) Within the 4 years immediately preceding the date of the application for license, the applicant must have completed a 40-hour classroom course in title insurance, 3 hours of which shall be on the subject matter of ethics, as approved by the department, or must have had at least 12 months of experience in responsible title insurance duties, while working in the title insurance business as a substantially full-time, bona fide employee of a title agency, title agent, title insurer, or attorney who conducts real estate closing transactions and issues title insurance policies but who is exempt from licensure pursuant to paragraph (4)(a). If an applicant’s qualifications are based upon the periods of employment at responsible title insurance duties, the applicant must submit, with the application for license on a form prescribed by the department, the affidavit of the applicant and of the employer setting forth the period of such employment, that the employment was substantially full time, and giving a brief abstract of the nature of the duties performed by the applicant.
(b) The applicant must have passed any examination for licensure required under s. 626.221.
(4)(a) Title insurers or attorneys duly admitted to practice law in this state and in good standing with The Florida Bar are exempt from the provisions of this chapter with regard to title insurance licensing and appointment requirements.
(b) An insurer may designate a corporate officer of the insurer to occasionally issue and countersign binders, commitments, title insurance policies, or guarantees of title. A designated officer is exempt from the provisions of this chapter with regard to title insurance licensing and appointment requirements while the officer is acting within the scope of the designation.
(c) If an attorney or attorneys own a corporation or other legal entity which is doing business as a title insurance agency other than an entity engaged in the active practice of law, the agency must be licensed and appointed as a title insurance agent.
History.—s. 5, ch. 85-185; s. 1, ch. 86-286; s. 4, ch. 89-305; s. 118, ch. 90-363; s. 184, ch. 91-108; ss. 15, 114, ch. 92-318; s. 46, ch. 98-199; s. 56, ch. 2003-267; s. 49, ch. 2003-281.
626.8418 Application for title insurance agency license.—Prior to doing business in this state as a title insurance agency, a title insurance agency must meet all of the following requirements:
(1) The applicant must file with the department an application for a license as a title insurance agency, on printed forms furnished by the department, that includes all of the following:
(a) The name of each majority owner, partner, officer, and director of the agency.
(b) The residence address of each person required to be listed under paragraph (a).
(c) The name of the agency and its principal business address.
(d) The location of each agency office and the name under which each agency office conducts or will conduct business.
(e) The name of each agent to be in full-time charge of an agency office and specification of which office.
(f) Such additional information as the department requires by rule to ascertain the trustworthiness and competence of persons required to be listed on the application and to ascertain that such persons meet the requirements of this code.
(2) The applicant must have deposited with the department securities of the type eligible for deposit under s. 625.52 and having at all times a market value of not less than $35,000. In place of such deposit, the title insurance agency may post a surety bond of like amount payable to the department for the benefit of any appointing insurer damaged by a violation by the title insurance agency of its contract with the appointing insurer. If a properly documented claim is timely filed with the department by a damaged title insurer, the department may remit an appropriate amount of the deposit or the proceeds that are received from the surety in payment of the claim. The required deposit or bond must be made by the title insurance agency, and a title insurer may not provide the deposit or bond directly or indirectly on behalf of the title insurance agency. The deposit or bond must secure the performance by the title insurance agency of its duties and responsibilities under the issuing agency contracts with each title insurer for which it is appointed. The agency may exchange or substitute other securities of like quality and value for securities on deposit, may receive the interest and other income accruing on such securities, and may inspect the deposit at all reasonable times. Such deposit or bond must remain unimpaired as long as the title insurance agency continues in business in this state and until 1 year after termination of all title insurance agency appointments held by the title insurance agency. The title insurance agency is entitled to the return of the deposit or bond together with accrued interest after such year has passed, if no claim has been made against the deposit or bond. If a surety bond is unavailable generally, the department may adopt rules for alternative methods to comply with this subsection. With respect to such alternative methods for compliance, the department must be guided by the past business performance and good reputation and character of the proposed title insurance agency. A surety bond is deemed to be unavailable generally if the prevailing annual premium exceeds 25 percent of the principal amount of the bond.
History.—s. 16, ch. 92-318; s. 47, ch. 98-199.
626.8419 Appointment of title insurance agency.—
(1) The title insurer engaging or employing the title insurance agency must file with the department, on forms furnished by the department, an application certifying that the proposed title insurance agency meets all of the following requirements:
(a) The agency must have obtained a fidelity bond in an amount, not less than $50,000, acceptable to the insurer appointing the agency. If a fidelity bond is unavailable generally, the department must adopt rules for alternative methods to comply with this paragraph.
(b) The agency must have obtained errors and omissions insurance in an amount acceptable to the insurer appointing the agency. The amount of the coverage may not be less than $250,000 per claim and an aggregate limit with a deductible no greater than $10,000. If errors and omissions insurance is unavailable generally, the department must adopt rules for alternative methods to comply with this paragraph.
(c) Notwithstanding s. 626.8418(2), the agency must have obtained a surety bond in an amount not less than $35,000 made payable to the title insurer or title insurers appointing the agency. The surety bond must be for the benefit of any appointing title insurer damaged by a violation by the title insurance agency of its contract with the appointing title insurer. If the surety bond is payable to multiple title insurers, the surety bond must provide that each title insurer is to be notified in the event a claim is made upon the surety bond or the bond is terminated.
(d) The surety bond must remain in effect and unimpaired as long as the agency is appointed by a title insurer. The agency must provide written proof to the appointing title insurer or insurers on an annual basis evidencing that the surety bond is still in effect and unimpaired.
(e) A title insurer may not provide the surety bond directly or indirectly on behalf of the agency.
(2) This section does not exempt title insurance agents from the appointment requirements of part I.
History.—s. 17, ch. 92-318; s. 25, ch. 2012-209.
626.84195 Confidentiality of information supplied by title insurance agencies and insurers.—
(1) As used in this section, the term “proprietary business information” means information that:
(a) Is owned or controlled by a title insurance agency or insurer requesting confidentiality under this section;
(b) Is intended to be and is treated by the title insurance agency or insurer as private in that the disclosure of the information would cause harm to the business operations of the title insurance agency or insurer;
(c) Has not been publicly disclosed unless disclosed pursuant to a statutory provision, an order of a court or administrative body, or a private agreement, providing that the information may be released to the public; and
(d) Concerns:
1. Business plans;
2. Internal auditing controls and reports of internal auditors;
3. Reports of external auditors for privately held companies;
4. Trade secrets, as defined in s. 688.002; or
5. Financial information, including, but not limited to, revenue data, loss expense data, gross receipts, taxes paid, capital investment, customer identification, and employee wages.
(2) Proprietary business information provided to the office by a title insurance agency or insurer is confidential and exempt from s. 119.07(1) and s. 24(a), Art. I of the State Constitution until such information is otherwise publicly available or is no longer treated by the title insurance agency or insurer as proprietary business information. However, information provided by multiple title insurance agencies and insurers may be aggregated on an industrywide basis and disclosed to the public as long as the specific identities of the agencies or insurers are not revealed.
(3) This section is subject to the Open Government Sunset Review Act in accordance with s. 119.15 and shall stand repealed on October 2, 2017, unless reviewed and saved from repeal through reenactment by the Legislature.
History.—s. 1, ch. 2012-207.
626.842 Credit and character reports.—
(1) As to each person appointed as title insurance agent for the first time in this state, the appointing insurer shall, coincidentally with such appointment, secure and thereafter keep on file a full, detailed credit and character report for the 5-year period immediately prior to the date of application for appointment, made by an established and reputable independent reporting service, relative to the individual, if a partnership or sole proprietorship, or the officers, if a corporation or other legal entity, unless otherwise expressly requested by the department.
(2) At the time the application is filed, the insurer shall furnish to the department, on a form furnished by the department, such information as the department may reasonably require relative to such title insurance agent and investigation.
(3) Information contained in credit or character reports furnished to the department under this section is confidential and exempt from the provisions of s. 119.07(1).
History.—s. 6, ch. 85-185; s. 1, ch. 86-286; s. 119, ch. 90-363; s. 114, ch. 92-318; s. 6, ch. 93-80; s. 374, ch. 96-406.
626.84201 Nonresident title insurance agents.—Notwithstanding s. 626.8414(2), the department, upon application and payment of the fees specified in s. 624.501, may issue a license as a nonresident title insurance agent to an individual not a resident of this state in the same manner applicable to the licensure of nonresident general lines agents under the provisions of s. 626.741, provided the individual passes the examination for licensure required under s. 626.221. Nonresident title insurance agents licensed pursuant to this section must complete the continuing education requirements of s. 626.2815 in the same manner as resident title insurance agents. Sections 626.742 and 626.743 apply to nonresident title insurance agents.
History.—s. 30, ch. 2005-257; s. 1, ch. 2007-44.
626.8421 Number of appointments permitted or required.—A title agent shall be required to have a separate appointment as to each insurer by which he or she is appointed as agent. As a part of each appointment there shall be a certified statement or affidavit of an appropriate officer or official of the appointing insurer stating that to the best of the insurer’s knowledge and belief the applicant, or its principals in the case of a corporation or other legal entity, has met the requirements of s. 626.8417.
History.—s. 120, ch. 90-363; s. 277, ch. 97-102.
626.8423 Investigation of applicants for license or renewal or continuation.—The department may propound reasonable interrogatories, in addition to those contained in the application, to any applicant for a title insurance agent’s license or appointment or for renewal or continuation of such a license or appointment relating to the applicant’s qualifications, residence, and prospective place of business and any other matter which the department considers necessary or advisable for the protection of the public and to ascertain the applicant’s qualifications. The department may, upon receipt of the application, make such further investigation as it considers advisable of the applicant’s character, experience, background, and fitness for the license.
History.—s. 7, ch. 85-185; s. 1, ch. 86-286; s. 121, ch. 90-363; s. 114, ch. 92-318.
626.8427 Number of applications for licensure required; exemption; effect of expiration of license.—
(1) After a license as a title insurance agent has been issued to a title insurance agent, the agent is not required to file another license application for a similar license, irrespective of the number of insurers to be represented by the agent, unless:
(a) The agent is specifically ordered by the department to complete a new application; or
(b) During any period of 48 months since the filing of the original license application, the agent was not appointed, unless in the case of individuals the failure to be so appointed was due to military service, in which event the period within which a new application is not required may, in the discretion of the department, be extended for 12 months following the date of discharge from military service if the military service does not exceed 3 years, but in no event shall the period be extended under this clause for a period of more than 6 years from the date of filing the original application.
(2) The department shall not charge a fee for filing an application for license with respect to any applicant for license who is exempted under this section from filing an application.
(3) Upon the expiration or termination of a title insurance agent’s appointment, the title insurance agent is without authority conferred by the license and shall not engage or attempt to engage in any activity requiring a title insurance agent’s license and appointment. The agent shall not again be granted an appointment until he or she fully qualifies therefor as provided in this chapter. An application shall be required in all cases for qualification of a new title insurance agent’s license when application is made after the expiration of 4 years from the date of the expiration or termination of the last appointment held by a licensee.
History.—s. 9, ch. 85-185; s. 1, ch. 86-286; s. 122, ch. 90-363; s. 114, ch. 92-318; s. 278, ch. 97-102; s. 16, ch. 2001-142; s. 967, ch. 2003-261.
626.843 Renewal, continuation, reinstatement, termination of title insurance agent’s appointment.—
(1) The appointment of a title insurance agent shall continue in force until suspended, revoked, or otherwise terminated, but subject to a renewed request filed by the insurer every 24 months after the original issue date of the appointment, accompanied by payment of the renewal appointment fee and taxes as prescribed in s. 624.501.
(2) Title insurance agent appointments shall be renewed pursuant to s. 626.381 for insurance representatives in general.
(3) The appointment issued shall remain in effect for so long as the appointment represented thereby continues in force as provided in this section.
History.—s. 10, ch. 85-185; s. 1, ch. 86-286; s. 22, ch. 87-226; s. 6, ch. 89-305; s. 123, ch. 90-363; s. 114, ch. 92-318; s. 57, ch. 2003-267; s. 50, ch. 2003-281.
626.8433 Filing of reasons for terminating appointment of title insurance agent; confidential information.—
(1) Any title insurer that is terminating the appointment of a title insurance agent, whether such termination is by direct action of the appointing title insurer or by failure to renew or continue the appointment as provided, shall file with the department a statement of the reasons, if any, for, and the facts relative to, such termination.
(2) In the case of a termination by failure to renew or continue the appointment, the information required under subsection (1) shall be filed with the department as soon as possible, and at all events within 30 days, after the date notice of intention not to renew or continue was filed with the department. In all other cases, the information required under subsection (1) shall be filed with the department at the time, or at all events within 10 days after, notice of the termination was filed with the department.
(3) Any information, document, record, or statement furnished to the department under subsection (1) is confidential and exempt from the provisions of s. 119.07(1).
History.—s. 11, ch. 85-185; s. 1, ch. 86-286; s. 124, ch. 90-363; s. 114, ch. 92-318; s. 7, ch. 93-80; s. 375, ch. 96-406.
626.8437 Grounds for denial, suspension, revocation, or refusal to renew license or appointment.—The department shall deny, suspend, revoke, or refuse to renew or continue the license or appointment of any title insurance agent or agency, and it shall suspend or revoke the eligibility to hold a license or appointment of such person, if it finds that as to the applicant, licensee, appointee, or any principal thereof, any one or more of the following grounds exist:
(1) Lack of one or more of the qualifications for the license or appointment as specified in ss. 626.8417, 626.8418, and 626.8419.
(2) Material misstatement, misrepresentation, or fraud in obtaining, or attempting to obtain, the license or appointment.
(3) Willful misrepresentation of any title insurance policy, guarantee of title, binder, or commitment, or willful deception with regard to any such policy, guarantee, binder, or commitment, done either in person or by any form of dissemination of information or advertising.
(4) Demonstrated lack of fitness or trustworthiness to represent a title insurer in the issuance of its commitments, binders, policies of title insurance, or guarantees of title.
(5) Demonstrated lack of reasonably adequate knowledge and technical competence to engage in the transactions authorized by the license or appointment.
(6) Fraudulent or dishonest practices in the conduct of business under the license or appointment.
(7) Misappropriation, conversion, or unlawful withholding of moneys belonging to title insurers or insureds or others and received in conduct of business under the license or appointment.
(8) Unlawful rebating, or attempting to unlawfully rebate, or unlawfully dividing, or offering to unlawfully divide, title insurance premiums, fees, or charges with another, as prohibited by s. 626.9541(1)(h)3.
(9) Willful failure to comply with, or willful violation of, any proper order or rule of the department or willful violation of any provision of this act.
(10) The licensee if an individual, or the partners if a partnership, or owner if a sole proprietorship, or the officers if a corporation, having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of the United States or of any state or under the law of any other country which involves moral turpitude, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
(11) Failure to timely submit data as required by s. 627.782.
History.—s. 12, ch. 85-185; s. 1, ch. 86-286; s. 5, ch. 89-305; s. 125, ch. 90-363; s. 114, ch. 92-318; s. 48, ch. 98-199; s. 2, ch. 2012-206.
626.844 Grounds for discretionary refusal, suspension, or revocation of license or appointment.—The department may, in its discretion, deny, suspend, revoke, or refuse to renew or continue the license or appointment of any title insurance agent or agency, and it may suspend or revoke the eligibility to hold a license or appointment of any such title insurance agent or agency if it finds that as to the applicant or licensee or appointee, or any principal thereof, any one or more of the following grounds exist under circumstances for which such denial, suspension, revocation, or refusal is not mandatory under s. 626.8437:
(1) Any cause for which issuance of the license or appointment could have been refused had it then existed and been known to the department.
(2) Violation of any provision of this act in the course of dealing under the license or appointment.
(3) Violation of any lawful order or rule of the department.
(4) Failure or refusal upon demand to pay over to any title insurer that the appointee represents or has represented any money coming into the hands of such appointee and belonging to the title insurer.
(5) Engaging in unfair methods of competition or in unfair or deceptive acts or practices in the conduct of business, as prohibited under part IX of this chapter, or having otherwise shown himself or herself to be a source of injury or loss to the public or to be detrimental to the public interest.
(6) The licensee if an individual, or the partners if a partnership, or owner if a sole proprietorship, or the officers if a corporation, having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of the United States or of any state or under the law of any other country, without regard to whether a judgment of conviction has been entered by the court having jurisdiction of such cases.
History.—s. 13, ch. 85-185; s. 1, ch. 86-286; s. 126, ch. 90-363; s. 114, ch. 92-318; s. 279, ch. 97-102; s. 49, ch. 98-199; s. 49, ch. 2001-63.
626.8443 Duration of suspension or revocation.—
(1) The department shall, in its order suspending a title insurance agent’s or agency’s license or appointment or in its order suspending the eligibility of a person to hold or apply for such license or appointment, specify the period during which the suspension is to be in effect, but such period shall not exceed 1 year. The license, or appointment, or eligibility shall remain suspended during the period so specified, subject, however, to any rescission or modification of the order by the department, or modification or reversal thereof by the court, prior to expiration of the suspension period. A license, appointment, or eligibility which has been suspended may not be reinstated except upon request for such reinstatement, but the department shall not grant such reinstatement if it finds that the circumstance or circumstances for which the license, appointment, and eligibility was suspended still exist or are likely to recur.
(2) A licensee and appointee whose license has been revoked by the department does not have the right to apply for a new license or appointment for 2 years from the effective date of the revocation or, if judicial review of such revocation is sought, for 2 years from the date of the final court order or decree affirming the revocation. The department shall not, however, grant a new license or appointment or reinstate eligibility to hold such license or appointment if it finds that the circumstance or circumstances for which the previous license and appointment was revoked still exist or are likely to recur.
(3) If licenses of any person as a title insurance agent or agency have been revoked twice, the department shall not thereafter grant or issue a title insurance agent’s or agency’s license to such person.
(4) During the period of suspension or after revocation of the license and appointment, the former licensee shall not engage in or attempt to profess to engage in any transaction or business for which a license or appointment is required under this code or directly or indirectly own, control, or be employed in any manner by any insurance agent or agency or adjuster or adjusting firm.
History.—s. 14, ch. 85-185; s. 1, ch. 86-286; s. 23, ch. 87-226; s. 127, ch. 90-363; s. 114, ch. 92-318; s. 50, ch. 98-199.
626.8447 Effect of suspension or revocation upon other licensees, appointees.—In case of the suspension or revocation of the license and appointment of any title insurance agent, the licenses and appointments of all other title insurance agents who knowingly were parties to the act which formed the ground for such suspension or revocation may likewise be suspended or revoked for the same period as that of the offending title insurance agent, but such suspension or revocation shall not prevent any title insurance agent, except the one whose license and appointment was first suspended or revoked, from being issued an appointment for some other title insurer.
History.—s. 15, ch. 85-185; s. 1, ch. 86-286; s. 128, ch. 90-363; s. 114, ch. 92-318.
626.845 Cancellation of license.—All certificates of licenses issued under this act are at all times the property of the state; and, upon notice by the department to the licensee of a suspension, revocation, refusal to renew, failure to renew, or expiration of a license or appointment, or upon termination of the agency agreement between the appointee and insurer, such license and appointment will no longer be in force and effect.
History.—s. 16, ch. 85-185; s. 1, ch. 86-286; s. 129, ch. 90-363; s. 114, ch. 92-318.
626.8453 Penalty for violation.—A person who knowingly makes a false or otherwise fraudulent application for a license or appointment under this act, or who knowingly violates any provision of s. 624.5015, ss. 626.8417-626.847, or s. 627.791, in addition to any applicable denial, suspension, revocation, or refusal to renew or continue any license or appointment, commits a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083. Each instance of violation shall be considered a separate offense.
History.—s. 17, ch. 85-185; s. 1, ch. 86-286; s. 3, ch. 89-305; s. 130, ch. 90-363; s. 114, ch. 92-318.
626.8457 Administrative fine in lieu of suspension or revocation of license or appointment.—
(1) If the department finds that one or more grounds exist for the suspension of, revocation of, or refusal to renew or continue any license or appointment issued under this act, the department may, in its discretion, in lieu of suspension, revocation, or refusal, and except on a second offense or when such suspension, revocation, or refusal is mandatory, impose upon the licensee or appointee an administrative penalty in the amount of $500 or, if the department has found willful misconduct or willful violation on the part of the licensee or appointee, in the amount of $2,500. The administrative penalty may, in the discretion of the department, be augmented by an amount equal to any commissions received by the licensee or appointee in connection with transactions as to which the grounds for suspension, revocation, or refusal related.
(2) The department may allow the licensee or appointee a reasonable period, not to exceed 30 days, within which to pay to the department the amount of the penalty so imposed. If the licensee or appointee fails to pay the penalty in its entirety to the department within the period allowed, the license and appointments of the licensee shall stand suspended or revoked or its renewal or continuation shall stand refused, as the case may be, upon expiration of such period and without any further proceeding.
History.—s. 18, ch. 85-185; s. 1, ch. 86-286; s. 24, ch. 87-226; s. 131, ch. 90-363; s. 114, ch. 92-318.
626.846 Probation.—
(1) If the department finds that one or more grounds exist for the suspension of, revocation of, or refusal to renew or continue any license or appointment issued under this act, the department may, except when an administrative fine is not permissible under s. 626.8457 or when such suspension, revocation, or refusal is mandatory, in lieu of such suspension, revocation, or refusal, or in connection with any administrative monetary penalty imposed under s. 626.8457, place the offending licensee or appointee on probation for a period not to exceed 2 years, as specified by the department in its order.
(2) As a condition to such probation or in connection therewith, the department may specify in its order reasonable terms and conditions to be fulfilled by the probationer during the probation period. If during the probation period the department has good cause to believe that the probationer has violated such terms and conditions, or any of them, it shall forthwith suspend, revoke, or refuse to renew or continue the license or appointment of the probationer, as upon the original ground or grounds referred to in subsection (1), by its order given to the licensee and title insurer without the necessity of further advance notice, hearing, or procedure.
History.—s. 19, ch. 85-185; s. 1, ch. 86-286; s. 132, ch. 90-363; s. 114, ch. 92-318.
626.8463 Witnesses and evidence.—
(1) As to the subject of any examination, investigation, or hearing being conducted by him or her under s. 624.5015, ss. 626.8417-626.847, or s. 627.791, an examiner appointed by the department or office may administer oaths, examine and cross-examine witnesses, and receive oral and documentary evidence and shall have the power to subpoena witnesses, compel their attendance and testimony, and require by subpoena the production of books, papers, records, files, correspondence, documents, or other evidence which the examiner deems relevant to the inquiry.
(2) Subpoenas shall be served, and proof of such service made, in the same manner as if issued by a circuit court. Witness fees and mileage, if claimed, shall be allowed the same as for testimony in a circuit court.
(3) If a person refuses to comply with any such subpoena or to testify as to any matter concerning which the person may be lawfully interrogated, the circuit court in and for Leon County, or the county in which such examination, investigation, or hearing is being conducted, or the county in which such person resides, upon application by the department or office, may issue an order requiring such person to comply with the subpoena and to testify. A person who fails to obey such an order of the court may be punished by the court for contempt.
(4) A person who willfully testifies falsely under oath as to any matter material to any such examination, investigation, or hearing is guilty of perjury and shall be punished accordingly.
History.—s. 20, ch. 85-185; s. 1, ch. 86-286; s. 114, ch. 92-318; s. 280, ch. 97-102; s. 968, ch. 2003-261.
626.8467 Testimony compelled; immunity from prosecution.—
(1) If a person asks to be excused from attending or testifying or from producing any books, papers, records, contracts, documents, or other evidence in connection with any examination, hearing, or investigation being conducted under s. 624.5015, ss. 626.8417-626.847, or s. 627.791 by the department or office or its examiner on the ground that the testimony or evidence required of the person may tend to incriminate him or her or subject him or her to a penalty or forfeiture and notwithstanding is directed to give such testimony or produce such evidence, the person must, if so directed by the Department of Financial Services and the Department of Legal Affairs or by the office and the Department of Legal Affairs, nonetheless comply with such direction, but he or she shall not thereafter be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he or she may have so testified or produced evidence, and no testimony so given or evidence produced shall be received against the person upon any criminal action, investigation, or proceeding. However, a person so testifying shall not be exempt from prosecution or punishment for any perjury committed by him or her in such testimony, and the testimony or evidence so given or produced shall be admissible against him or her upon any criminal action, investigation, or proceeding concerning such perjury; and such person shall not be exempt from the refusal, suspension, or revocation of any license or appointment, permission, or authority conferred or to be conferred pursuant to s. 624.5015, ss. 626.8417-626.847, or s. 627.791.
(2) Any such person may execute, acknowledge, and file with the Department of Financial Services or the office, as appropriate, a statement expressly waiving such immunity or privilege with respect to any transaction, matter, or thing specified in the statement, and thereupon the testimony of such person or such evidence in relation to such transaction, matter, or thing may be received or produced before any judge or justice, court, tribunal, or grand jury or otherwise and, if so received or produced, such person shall not be entitled to any immunity or privilege on account of any testimony he or she may so give or evidence so produced.
History.—s. 21, ch. 85-185; s. 1, ch. 86-286; s. 133, ch. 90-363; s. 114, ch. 92-318; s. 281, ch. 97-102; s. 969, ch. 2003-261.
626.847 Penalty for refusal to testify.—A person who refuses or fails, without lawful cause, to testify relative to the affairs of any title insurer or other person when subpoenaed under s. 626.8463 and requested by the department or office to so testify is guilty of a misdemeanor of the second degree and, upon conviction, is punishable as provided in s. 775.082 or s. 775.083.
History.—s. 22, ch. 85-185; s. 1, ch. 86-286; s. 154, ch. 91-224; s. 114, ch. 92-318; s. 970, ch. 2003-261.
626.8473 Escrow; trust fund.—
(1) A title insurance agent may engage in business as an escrow agent as to funds received from others to be subsequently disbursed by the title insurance agent in connection with real estate closing transactions involving the issuance of title insurance binders, commitments, policies of title insurance, or guarantees of title, provided that a licensed and appointed title insurance agent complies with the requirements of s. 626.8417, including such requirements added after the initial licensure of the agent.
(2) All funds received by a title insurance agent as described in subsection (1) shall be trust funds received in a fiduciary capacity by the title insurance agent and shall be the property of the person or persons entitled thereto.
(3) All funds received by a title insurance agent to be held in trust shall be immediately placed in a financial institution that is located within this state and is a member of the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund. These funds shall be invested in an escrow account in accordance with the investment requirements and standards established for deposits and investments of state funds in s. 17.57, where the funds shall be kept until disbursement thereof is properly authorized.
(4) Funds required to be maintained in escrow trust accounts pursuant to this section shall not be subject to any debts of the title insurance agent and shall be used only in accordance with the terms of the individual, escrow, settlement, or closing instructions under which the funds were accepted.
(5) The title insurance agents shall maintain separate records of all receipts and disbursements of escrow, settlement, or closing funds.
(6) In the event that the department promulgates rules necessary to implement the requirements of this section pursuant to s. 624.308, the department shall consider reasonable standards necessary for the protection of funds held in trust, including, but not limited to, standards for accounting of funds, standards for receipt and disbursement of funds, and protection for the person or persons to whom the funds are to be disbursed.
(7) A title insurance agent, or any officer, director, or employee thereof, or any person associated therewith as an independent contractor for bookkeeping or similar purposes, who converts or misappropriates funds received or held in escrow or in trust by such title insurance agent, or any person who knowingly receives or conspires to receive such funds, commits:
(a) If the funds converted or misappropriated are $300 or less, a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083.
(b) If the funds converted or misappropriated are more than $300, but less than $20,000, a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(c) If the funds converted or misappropriated are $20,000 or more, but less than $100,000, a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(d) If the funds converted or misappropriated are $100,000 or more, a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(8) An attorney shall deposit and maintain all funds received in connection with transactions in which the attorney is serving as a title or real estate settlement agent into a separate trust account that is maintained exclusively for funds received in connection with such transactions and permit the account to be audited by its title insurers, unless maintaining funds in the separate account for a particular client would violate applicable rules of The Florida Bar.
History.—s. 24, ch. 85-185; s. 1, ch. 86-286; s. 1, ch. 89-305; s. 134, ch. 90-363; s. 114, ch. 92-318; s. 3, ch. 98-409; s. 971, ch. 2003-261; s. 3, ch. 2012-206.
PART VI
INSURANCE ADJUSTERS626.851 Short title.
626.852 Scope of this part.
626.853 Part supplements licensing law.
626.854 “Public adjuster” defined; prohibitions.
626.8541 Public adjuster apprentice.
626.8548 “All-lines adjuster” defined.
626.855 “Independent adjuster” defined.
626.856 “Company employee adjuster” defined.
626.8582 “Nonresident public adjuster” defined.
626.8584 “Nonresident all-lines adjuster” defined.
626.859 “Catastrophe” or “emergency” adjuster defined.
626.860 Attorneys at law; exemption.
626.861 Insurer’s officers, insurer’s employees, reciprocal insurer’s representatives; adjustments by.
626.862 Agents; adjustments by.
626.863 Claims referrals to independent adjusters.
626.864 Adjuster license types.
626.865 Public adjuster’s qualifications, bond.
626.8651 Public adjuster apprentice license; qualifications.
626.866 All-lines adjuster qualifications.
626.8685 Portable electronics insurance claims; exemption; licensure restriction.
626.869 License, adjusters; continuing education.
626.8695 Primary adjuster.
626.8696 Application for adjusting firm license.
626.8697 Grounds for refusal, suspension, or revocation of adjusting firm license.
626.8698 Disciplinary guidelines for public adjusters and public adjuster apprentices.
626.870 Application for license.
626.871 Reappointment after military service.
626.872 Temporary license.
626.8732 Nonresident public adjuster’s qualifications, bond.
626.8734 Nonresident all-lines adjuster license qualifications.
626.8736 Nonresident independent or public adjusters; service of process.
626.8737 Nonresident adjusters; retaliatory provision.
626.8738 Penalty for violation.
626.874 Catastrophe or emergency adjusters.
626.875 Office and records.
626.876 Exclusive employment; public adjusters, independent adjusters.
626.877 Adjustments to comply with insurance contract and law.
626.878 Rules; code of ethics.
626.879 Pools of insurance adjusters.
626.8795 Public adjusters; prohibition of conflict of interest.
626.8796 Public adjuster contracts; fraud statement.
626.8797 Proof of loss; fraud statement.
626.851 Short title.—This part may be referred to in any legal proceedings as the “Insurance Adjusters Law.”
History.—s. 315, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.852 Scope of this part.—
(1) This part applies only to insurance adjusters as defined in this part.
(2) Unless otherwise required by context, the term “adjusters” as used in this part applies to all licensees defined as any type of adjuster.
(3) This part does not apply as to life insurance or annuity contracts.
(4) This part does not apply to third-party administrators or a person employed by a third-party administrator holding a certificate of authority pursuant to ss. 626.88-626.894.
(5) This part does not apply to any employee or agent of a state university board of trustees providing services in support of any self-insurance program created under former s. 240.213 or s. 1004.24.
(6) This part does not apply to any person who adjusts only multiple-peril crop insurance or crop hail claims.
History.—s. 314, ch. 59-205; s. 2, ch. 65-16; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 269(2nd), 293, 807, 810, ch. 82-243; ss. 135, 206, 207, ch. 90-363; s. 60, ch. 91-108; s. 4, ch. 91-429; s. 51, ch. 98-199; s. 2, ch. 2000-270; s. 38, ch. 2002-206; s. 3, ch. 2002-401; s. 87, ch. 2003-1.
626.853 Part supplements licensing law.—This part is supplementary to part I, the “Licensing Procedures Law.”
History.—s. 316, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.854 “Public adjuster” defined; prohibitions.—The Legislature finds that it is necessary for the protection of the public to regulate public insurance adjusters and to prevent the unauthorized practice of law.
(1) A “public adjuster” is any person, except a duly licensed attorney at law as exempted under s. 626.860, who, for money, commission, or any other thing of value, prepares, completes, or files an insurance claim form for an insured or third-party claimant or who, for money, commission, or any other thing of value, acts on behalf of, or aids an insured or third-party claimant in negotiating for or effecting the settlement of a claim or claims for loss or damage covered by an insurance contract or who advertises for employment as an adjuster of such claims. The term also includes any person who, for money, commission, or any other thing of value, solicits, investigates, or adjusts such claims on behalf of a public adjuster.
(2) This definition does not apply to:
(a) A licensed health care provider or employee thereof who prepares or files a health insurance claim form on behalf of a patient.
(b) A person who files a health claim on behalf of another and does so without compensation.
(3) A public adjuster may not give legal advice or act on behalf of or aid any person in negotiating or settling a claim relating to bodily injury, death, or noneconomic damages.
(4) For purposes of this section, the term “insured” includes only the policyholder and any beneficiaries named or similarly identified in the policy.
(5) A public adjuster may not directly or indirectly through any other person or entity solicit an insured or claimant by any means except on Monday through Saturday of each week and only between the hours of 8 a.m. and 8 p.m. on those days.
(6) A public adjuster may not directly or indirectly through any other person or entity initiate contact or engage in face-to-face or telephonic solicitation or enter into a contract with any insured or claimant under an insurance policy until at least 48 hours after the occurrence of an event that may be the subject of a claim under the insurance policy unless contact is initiated by the insured or claimant.
(7) An insured or claimant may cancel a public adjuster’s contract to adjust a claim without penalty or obligation within 3 business days after the date on which the contract is executed or within 3 business days after the date on which the insured or claimant has notified the insurer of the claim, by phone or in writing, whichever is later. The public adjuster’s contract must disclose to the insured or claimant his or her right to cancel the contract and advise the insured or claimant that notice of cancellation must be submitted in writing and sent by certified mail, return receipt requested, or other form of mailing that provides proof thereof, to the public adjuster at the address specified in the contract; provided, during any state of emergency as declared by the Governor and for 1 year after the date of loss, the insured or claimant has 5 business days after the date on which the contract is executed to cancel a public adjuster’s contract.
(8) It is an unfair and deceptive insurance trade practice pursuant to s. 626.9541 for a public adjuster or any other person to circulate or disseminate any advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance which is untrue, deceptive, or misleading.
(a) The following statements, made in any public adjuster’s advertisement or solicitation, are considered deceptive or misleading:
1. A statement or representation that invites an insured policyholder to submit a claim when the policyholder does not have covered damage to insured property.
2. A statement or representation that invites an insured policyholder to submit a claim by offering monetary or other valuable inducement.
3. A statement or representation that invites an insured policyholder to submit a claim by stating that there is “no risk” to the policyholder by submitting such claim.
4. A statement or representation, or use of a logo or shield, that implies or could mistakenly be construed to imply that the solicitation was issued or distributed by a governmental agency or is sanctioned or endorsed by a governmental agency.
(b) For purposes of this paragraph, the term “written advertisement” includes only newspapers, magazines, flyers, and bulk mailers. The following disclaimer, which is not required to be printed on standard size business cards, must be added in bold print and capital letters in typeface no smaller than the typeface of the body of the text to all written advertisements by a public adjuster:
“THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU MAY DISREGARD THIS ADVERTISEMENT.”
(9) A public adjuster, a public adjuster apprentice, or any person or entity acting on behalf of a public adjuster or public adjuster apprentice may not give or offer to give a monetary loan or advance to a client or prospective client.
(10) A public adjuster, public adjuster apprentice, or any individual or entity acting on behalf of a public adjuster or public adjuster apprentice may not give or offer to give, directly or indirectly, any article of merchandise having a value in excess of $25 to any individual for the purpose of advertising or as an inducement to entering into a contract with a public adjuster.
(11)(a) If a public adjuster enters into a contract with an insured or claimant to reopen a claim or file a supplemental claim that seeks additional payments for a claim that has been previously paid in part or in full or settled by the insurer, the public adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value based on a previous settlement or previous claim payments by the insurer for the same cause of loss. The charge, compensation, payment, commission, fee, or other thing of value 1must be based only on the claim payments or settlement obtained through the work of the public adjuster after entering into the contract with the insured or claimant. Compensation for the reopened or supplemental claim may not exceed 20 percent of the reopened or supplemental claim payment. The contracts described in this paragraph are not subject to the limitations in paragraph (b).
(b) A public adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value in excess of:
1. Ten percent of the amount of insurance claim payments made by the insurer for claims based on events that are the subject of a declaration of a state of emergency by the Governor. This provision applies to claims made during 2the year after the declaration of emergency. 3After that year, the limitations in subparagraph 2. apply.
2. Twenty percent of the amount of insurance claim payments made by the insurer for claims that are not based on events that are the subject of a declaration of a state of emergency by the Governor.
(12) Each public adjuster must provide to the claimant or insured a written estimate of the loss to assist in the submission of a proof of loss or any other claim for payment of insurance proceeds. The public adjuster shall retain such written estimate for at least 5 years and shall make the estimate available to the claimant or insured, the insurer, and the department upon request.
(13) A public adjuster, public adjuster apprentice, or any person acting on behalf of a public adjuster or apprentice may not accept referrals of business from any person with whom the public adjuster conducts business if there is any form or manner of agreement to compensate the person, directly or indirectly, for referring business to the public adjuster. A public adjuster may not compensate any person, except for another public adjuster, directly or indirectly, for the principal purpose of referring business to the public adjuster.
(14) A company employee adjuster, independent adjuster, attorney, investigator, or other persons acting on behalf of an insurer that needs access to an insured or claimant or to the insured property that is the subject of a claim must provide at least 48 hours’ notice to the insured or claimant, public adjuster, or legal representative before scheduling a meeting with the claimant or an onsite inspection of the insured property. The insured or claimant may deny access to the property if the notice has not been provided. The insured or claimant may waive the 48-hour notice.
(15) A public adjuster must ensure prompt notice of property loss claims submitted to an insurer by or through a public adjuster or on which a public adjuster represents the insured at the time the claim or notice of loss is submitted to the insurer. The public adjuster must ensure that notice is given to the insurer, the public adjuster’s contract is provided to the insurer, the property is available for inspection of the loss or damage by the insurer, and the insurer is given an opportunity to interview the insured directly about the loss and claim. The insurer must be allowed to obtain necessary information to investigate and respond to the claim.
(a) The insurer may not exclude the public adjuster from its in-person meetings with the insured. The insurer shall meet or communicate with the public adjuster in an effort to reach agreement as to the scope of the covered loss under the insurance policy. This section does not impair the terms and conditions of the insurance policy in effect at the time the claim is filed.
(b) A public adjuster may not restrict or prevent an insurer, company employee adjuster, independent adjuster, attorney, investigator, or other person acting on behalf of the insurer from having reasonable access at reasonable times to an insured or claimant or to the insured property that is the subject of a claim.
(c) A public adjuster may not act or fail to reasonably act in any manner that obstructs or prevents an insurer or insurer’s adjuster from timely conducting an inspection of any part of the insured property for which there is a claim for loss or damage. The public adjuster representing the insured may be present for the insurer’s inspection, but if the unavailability of the public adjuster otherwise delays the insurer’s timely inspection of the property, the public adjuster or the insured must allow the insurer to have access to the property without the participation or presence of the public adjuster or insured in order to facilitate the insurer’s prompt inspection of the loss or damage.
(16) A licensed contractor under part I of chapter 489, or a subcontractor, may not adjust a claim on behalf of an insured unless licensed and compliant as a public adjuster under this chapter. However, the contractor may discuss or explain a bid for construction or repair of covered property with the residential property owner who has suffered loss or damage covered by a property insurance policy, or the insurer of such property, if the contractor is doing so for the usual and customary fees applicable to the work to be performed as stated in the contract between the contractor and the insured.
(17) The provisions of subsections (5)-(16) apply only to residential property insurance policies and condominium unit owner policies as defined in s. 718.111(11).
History.—s. 317, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; s. 25, ch. 88-166; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1, ch. 95-238; s. 10, ch. 2008-220; s. 3, ch. 2009-87; ss. 7, 8, ch. 2011-39.
2Note.—The words “period of 1” following the word “the” were deleted without coding by s. 8, ch. 2011-39.
3Note.—As enacted without coding by s. 8, ch. 2011-39, effective January 1, 2012. Section 7, ch. 2011-39, added a different version, with coding, effective June 1, 2011, and that version reads: “After that 1-year period, 20 percent of the amount of insurance claim payments made by the insurer.”
626.8541 Public adjuster apprentice.—
(1) A “public adjuster apprentice” is any person who is not a licensed public adjuster, who is employed by or has a contract with a licensed and appointed public adjuster in good standing with the department or a public adjusting firm that employs at least one licensed and appointed public adjuster in good standing with the department to assist a public adjuster in conducting business under the license, and who satisfies the requirements of s. 626.8651.
(2) A public adjuster apprentice must work with a licensed and appointed public adjuster for a period of 12 months as set forth in this section, and must otherwise be in full compliance with this chapter, prior to being eligible for appointment as a licensed public adjuster.
History.—s. 11, ch. 2008-220; s. 79, ch. 2009-21.
626.8548 “All-lines adjuster” defined.—An “all-lines adjuster” is a person who is self-employed or employed by an insurer, a wholly owned subsidiary of an insurer, or an independent adjusting firm or other independent adjuster, and who undertakes on behalf of an insurer or other insurers under common control or ownership to ascertain and determine the amount of any claim, loss, or damage payable under an insurance contract or undertakes to effect settlement of such claim, loss, or damage. The term does not apply to life insurance or annuity contracts.
History.—s. 26, ch. 2012-209.
626.855 “Independent adjuster” defined.—An “independent adjuster” means a person licensed as an all-lines adjuster who is self-appointed or appointed and employed by an independent adjusting firm or other independent adjuster, and who undertakes on behalf of an insurer to ascertain and determine the amount of any claim, loss, or damage payable under an insurance contract or undertakes to effect settlement of such claim, loss, or damage.
History.—s. 318, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 27, ch. 2012-209.
626.856 “Company employee adjuster” defined.—A “company employee adjuster” means a person licensed as an all-lines adjuster who is appointed and employed on an insurer’s staff of adjusters or a wholly owned subsidiary of the insurer, and who undertakes on behalf of such insurer or other insurers under common control or ownership to ascertain and determine the amount of any claim, loss, or damage payable under a contract of insurance, or undertakes to effect settlement of such claim, loss, or damage.
History.—s. 319, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 17, ch. 2001-142; s. 28, ch. 2012-209.
626.8582 “Nonresident public adjuster” defined.—A “nonresident public adjuster” is a person who:
(1) Is not a resident of this state;
(2) Is a currently licensed public adjuster in his or her state of residence for the type or kinds of insurance for which the licensee intends to adjust claims in this state or, if a resident of a state that does not license public adjusters, has passed the department’s adjuster examination as prescribed in s. 626.8732(1)(b); and
(3) Is a self-employed public adjuster or associated with or employed by a public adjusting firm or other public adjuster.
History.—s. 53, ch. 98-199; s. 972, ch. 2003-261; s. 53, ch. 2004-390.
626.8584 “Nonresident all-lines adjuster” defined.—A “nonresident all-lines adjuster” means a person who:
(1) Is not a resident of this state;
(2) Is currently licensed as an adjuster in his or her state of residence for all lines of insurance except life and annuities or, if a resident of a state that does not license such adjusters, meets the qualifications prescribed in s. 626.8734; and
(3) Is licensed as an all-lines adjuster and self-appointed or appointed and employed by an independent adjusting firm or other independent adjuster, by an insurer admitted to do business in this state or a wholly owned subsidiary of an insurer admitted to do business in this state, or by other insurers under the common control or ownership of such insurer.
History.—s. 54, ch. 98-199; s. 973, ch. 2003-261; s. 54, ch. 2004-390; s. 30, ch. 2012-209.
626.859 “Catastrophe” or “emergency” adjuster defined.—A “catastrophe” or “emergency” adjuster is a person who is not a licensed adjuster under this part, but who has been designated and certified to the department by insurers as qualified to adjust claims, losses, or damages under policies or contracts of insurance issued by such insurer, and whom the department may license, in the event of a catastrophe or emergency, for the purposes and under the conditions which the department shall fix and for the period of the emergency as the department shall determine, to adjust claims, losses, or damages under the policies of insurance issued by the insurers.
History.—s. 322, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 275, 293, 807, 810, ch. 82-243; ss. 138, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 974, ch. 2003-261; s. 55, ch. 2004-390.
626.860 Attorneys at law; exemption.—Attorneys at law duly licensed to practice law in the courts of this state, and in good standing with The Florida Bar, shall not be required to be licensed under the provisions of this code to authorize them to adjust or participate in the adjustment of any claim, loss, or damage arising under policies or contracts of insurance.
History.—s. 323, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.861 Insurer’s officers, insurer’s employees, reciprocal insurer’s representatives; adjustments by.—
(1) Nothing in this part shall be construed to prevent an executive officer of any insurer, or a regularly salaried employee of an insurer handling claims with respect to health insurance, or the duly designated attorney or agent authorized and acting for subscribers to reciprocal insurers, from adjusting any claim loss or damage under any insurance contract of such insurer.
(2) If any such officer, employee, attorney, or agent in connection with the adjustment of any such claim, loss, or damage engages in any of the misconduct described in or contemplated by s. 626.611(6), the office may suspend or revoke the insurer’s certificate of authority.
History.—s. 324, ch. 59-205; s. 3, ch. 65-16; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 276, 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 975, ch. 2003-261.
626.862 Agents; adjustments by.—A licensed and appointed insurance agent may, without being licensed as an adjuster, adjust losses for the insurer represented by him or her as agent if so authorized by the insurer. The license and appointment of the agent may be suspended or revoked for violation of or misconduct prohibited by s. 626.611(6).
History.—s. 325, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 277, 293, 807, 810, ch. 82-243; ss. 139, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 284, ch. 97-102; s. 72, ch. 2002-206.
626.863 Claims referrals to independent adjusters.—
(1) An insurer may not knowingly refer any claim or loss for adjustment in this state to any person purporting to be or acting as an independent adjuster unless the person is currently licensed as an all-lines adjuster and appointed as an independent adjuster under this code.
(2) Before referring any claim or loss, the insurer shall ascertain from the department whether the proposed independent adjuster is currently licensed as an all-lines adjuster and appointed as an independent adjuster. Having ascertained that a particular person is so licensed and appointed, the insurer may assume that he or she will continue to be so licensed and appointed until the insurer has knowledge, or receives information from the department, to the contrary.
(3) This section does not apply to catastrophe or emergency adjusters as provided in this part.
History.—s. 326, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 278, 293, 807, 810, ch. 82-243; ss. 140, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 285, ch. 97-102; s. 976, ch. 2003-261; s. 56, ch. 2004-390; s. 31, ch. 2012-209.
626.864 Adjuster license types.—
(1) A qualified individual may be licensed as:
(a) A public adjuster; or
(b) An all-lines adjuster.
(2) The same individual may not be concurrently licensed as a public adjuster and an all-lines adjuster.
(3) An all-lines adjuster may be appointed as an independent adjuster or company employee adjuster, but not both concurrently.
History.—s. 327, ch. 59-205; s. 3. ch. 81-282; s. 2, ch. 81-318; ss. 279, 293, 807, 810, ch. 82-243; ss. 141, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 32, ch. 2012-209.
626.865 Public adjuster’s qualifications, bond.—
(1) The department shall issue a license to an applicant for a public adjuster’s license upon determining that the applicant has paid the applicable fees specified in s. 624.501 and possesses the following qualifications:
(a) Is a natural person at least 18 years of age.
(b) Is a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services.
(c) Is trustworthy and has such business reputation as would reasonably assure that the applicant will conduct his or her business as insurance adjuster fairly and in good faith and without detriment to the public.
(d) Has had sufficient experience, training, or instruction concerning the adjusting of damages or losses under insurance contracts, other than life and annuity contracts, is sufficiently informed as to the terms and effects of the provisions of those types of insurance contracts, and possesses adequate knowledge of the laws of this state relating to such contracts as to enable and qualify him or her to engage in the business of insurance adjuster fairly and without injury to the public or any member thereof with whom the applicant may have business as a public adjuster, or has been licensed and employed as a resident insurance company adjuster or independent adjuster in this state on a continual basis for the past year.
(e) Is licensed as a public adjuster apprentice under s. 626.8651 and complies with the requirements of that license throughout the licensure period.
(2) At the time of application for license as a public adjuster, the applicant shall file with the department a bond executed and issued by a surety insurer authorized to transact such business in this state, in the amount of $50,000, conditioned for the faithful performance of his or her duties as a public adjuster under the license for which the applicant has applied, and thereafter maintain the bond unimpaired throughout the existence of the license and for at least 1 year after termination of the license. The bond shall be in favor of the department and shall specifically authorize recovery by the department of the damages sustained in case the licensee is guilty of fraud or unfair practices in connection with his or her business as public adjuster. The aggregate liability of the surety for all such damages shall in no event exceed the amount of the bond. Such bond shall not be terminated unless at least 30 days’ written notice is given to the licensee and filed with the department.
(3) The department may not issue a license as a public adjuster to any individual who has not passed the examination for a public adjuster’s license. Any individual who is applying for reinstatement of a license after completion of a period of suspension and any individual who is applying for a new license after termination, cancellation, revocation, or expiration of a prior license as a public adjuster must pass the examination required for licensure as a public adjuster after approval of the application for reinstatement or for a new license regardless of whether the applicant passed an examination prior to issuance of the license that was suspended, terminated, canceled, revoked, or expired.
History.—s. 328, ch. 59-205; s. 4, ch. 65-16; ss. 13, 35, ch. 69-106; s. 1, ch. 77-116; s. 53, ch. 77-121; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 280, 293, 807, 810, ch. 82-243; s. 37, ch. 82-386; ss. 142, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 286, ch. 97-102; s. 55, ch. 98-199; s. 977, ch. 2003-261; s. 58, ch. 2003-267; s. 51, ch. 2003-281; s. 117, ch. 2004-5; s. 57, ch. 2004-390; s. 5, ch. 2007-199; s. 12, ch. 2008-220; s. 5, ch. 2009-87; s. 33, ch. 2012-209.
626.8651 Public adjuster apprentice license; qualifications.—
(1) The department shall issue a license as a public adjuster apprentice to an applicant who is:
(a) A natural person at least 18 years of age.
(b) A United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services.
(c) Trustworthy and has such business reputation as would reasonably ensure that the applicant will conduct business as a public adjuster apprentice fairly and in good faith and without detriment to the public.
(2) All applicable license fees, as prescribed in s. 624.501, must be paid in full before issuance of the license.
(3) An applicant must pass the required written examination before a license may be issued.
(4) An applicant must have received designation as an Accredited Claims Adjuster (ACA), as a Certified Adjuster (CA), or as a Certified Claims Adjuster (CCA) after completion of training that qualifies the applicant to engage in the business of a public adjuster apprentice fairly and without injury to the public. Such training and instruction must address adjusting damages and losses under insurance contracts, the terms and effects of insurance contracts, and knowledge of the laws of this state relating to insurance contracts.
(5) At the time of application for license as a public adjuster apprentice, the applicant shall file with the department a bond executed and issued by a surety insurer authorized to transact such business in this state in the amount of $50,000, conditioned upon the faithful performance of his or her duties as a public adjuster apprentice under the license for which the applicant has applied, and thereafter maintain the bond unimpaired throughout the existence of the license and for at least 1 year after termination of the license. The bond shall be in favor of the department and shall specifically authorize recovery by the department of the damages sustained in case the licensee commits fraud or unfair practices in connection with his or her business as a public adjuster apprentice. The aggregate liability of the surety for all such damages may not exceed the amount of the bond, and the bond may not be terminated by the issuing insurer unless written notice of at least 30 days is given to the licensee and filed with the department.
(6) A public adjuster apprentice shall complete at a minimum 100 hours of employment per month for 12 months of employment under the supervision of a licensed and appointed all-lines public adjuster in order to qualify for licensure as a public adjuster. The department may adopt rules that establish standards for such employment requirements.
(7) An appointing public adjusting firm may not maintain more than 12 public adjuster apprentices simultaneously. However, a supervising public adjuster may not be responsible for more than three public adjuster apprentices simultaneously and shall be accountable for the acts of all public adjuster apprentices which are related to transacting business as a public adjuster apprentice. This subsection does not apply to a public adjusting firm that adjusts claims primarily for commercial entities with operations in more than one state and that does not directly or indirectly perform adjusting services for insurers or individual homeowners.
(8) An apprentice license is effective for 18 months unless the license expires due to lack of maintaining an appointment; is surrendered by the licensee; is terminated, suspended, or revoked by the department; or is canceled by the department upon issuance of a public adjuster license. The department may not issue a public adjuster apprentice license to any individual who has held such a license in this state within 2 years after expiration, surrender, termination, revocation, or cancellation of the license.
(9) After completing the requirements for employment as a public adjuster apprentice, the licensee may file an application for a public adjuster license. The applicant and supervising public adjuster or public adjusting firm must each file a sworn affidavit, on a form prescribed by the department, verifying that the employment of the public adjuster apprentice meets the requirements of this section.
(10) In no event shall a public adjuster apprentice licensed under this section perform any of the functions for which a public adjuster’s license is required after expiration of the public adjuster apprentice license without having obtained a public adjuster license.
(11) A public adjuster apprentice has the same authority as the licensed public adjuster or public adjusting firm that employs the apprentice except that an apprentice may not execute contracts for the services of a public adjuster or public adjusting firm and may not solicit contracts for the services except under the direct supervision and guidance of the supervisory public adjuster. An individual may not be, act as, or hold himself or herself out to be a public adjuster apprentice unless the individual is licensed and holds a current appointment by a licensed public all-lines adjuster or a public adjusting firm that employs a licensed all-lines public adjuster.
History.—s. 13, ch. 2008-220; s. 6, ch. 2009-87; s. 8, ch. 2011-174; s. 34, ch. 2012-209.
626.866 All-lines adjuster qualifications.—The department shall issue an all-lines adjuster license to an applicant upon determining that the applicable license fee specified in s. 624.501 has been paid and that the applicant possesses the following qualifications:
(1) Is a natural person at least 18 years of age.
(2) Is a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services and a bona fide resident of this state.
(3) Is trustworthy and has such business reputation as would reasonably assure that the applicant will conduct his or her business as insurance adjuster fairly and in good faith and without detriment to the public.
(4) Has had sufficient experience, training, or instruction concerning the adjusting of damage or loss under insurance contracts, other than life and annuity contracts, is sufficiently informed as to the terms and the effects of the provisions of such types of contracts, and possesses adequate knowledge of the insurance laws of this state relating to such contracts as to enable and qualify him or her to engage in the business of insurance adjuster fairly and without injury to the public or any member thereof with whom he or she may have relations as an insurance adjuster and to adjust all claims in accordance with the policy or contract and the insurance laws of this state.
(5) Has passed any required written examination or has met one of the exemptions prescribed under s. 626.221.
History.—s. 329, ch. 59-205; s. 5, ch. 65-16; ss. 13, 35, ch. 69-106; s. 1, ch. 77-116; s. 54, ch. 77-121; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 281, 293, 807, 810, ch. 82-243; s. 38, ch. 82-386; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 287, ch. 97-102; s. 978, ch. 2003-261; s. 59, ch. 2003-267; s. 52, ch. 2003-281; s. 118, ch. 2004-5; s. 58, ch. 2004-390; s. 35, ch. 2012-209.
626.8685 Portable electronics insurance claims; exemption; licensure restriction.—
(1) This part does not apply to any individual who collects claims information from, or furnishes claims information to, insureds or claimants, and who conducts data entry, including entering data into an automated claims adjudication system, provided that the individual is an employee of a business entity licensed under this chapter, or its affiliate, and no more than 25 such persons are under the supervision of one licensed independent adjuster or licensed agent who is exempt from licensure pursuant to s. 626.862. For purposes of this subsection, the term “automated claims adjudication system” means a preprogrammed computer system designed for the collection, data entry, calculation, and final resolution of portable electronics insurance claims that:
(a) May be used only by a licensed independent adjuster, licensed agent, or supervised individual operating pursuant to this subsection;
(b) Must comply with all claims payment requirements of the insurance code; and
(c) Must be certified as compliant with this subsection by a licensed independent adjuster that is an officer of a licensed business entity under this chapter.
(2) Notwithstanding any other provision of law, a resident of Canada may not be licensed as a nonresident independent adjuster for purposes of adjusting portable electronics insurance claims unless the person has successfully obtained an adjuster’s license in another state.
History.—s. 8, ch. 2012-151.
626.869 License, adjusters; continuing education.—
(1) Having a license as an all-lines adjuster qualifies the licensee to adjust all lines of insurance except life and annuities.
(2) All individuals who on October 1, 1990, hold an adjuster’s license and appointment limited to fire and allied lines, including marine or casualty or boiler and machinery, may remain licensed and appointed under the limited license and may renew their appointment, but a license or appointment that has been terminated, not renewed, suspended, or revoked may not be reinstated, and new or additional licenses or appointments may not be issued.
(3) All individuals who on October 1, 2012, hold an adjuster’s license and appointment limited to motor vehicle physical damage and mechanical breakdown, property and casualty, workers’ compensation, or health insurance may remain licensed and appointed under such limited license and may renew their appointment, but a license that has been terminated, suspended, or revoked may not be reinstated, and new or additional licenses may not be issued.
(4) An individual holding a license as a public adjuster or an all-lines adjuster must complete all continuing education requirements as specified in s. 626.2815.
(5) The regulation of continuing education for licensees, course providers, instructors, school officials, and monitor groups shall be as provided in s. 626.2816.
History.—s. 332, ch. 59-205; s. 90, ch. 79-40; ss. 2, 3, ch. 81-282; s. 2, ch. 81-318; ss. 284, 293, 807, 810, ch. 82-243; s. 26, ch. 88-166; s. 33, ch. 89-289; s. 50, ch. 90-201; ss. 143, 206, 207, ch. 90-363; s. 48, ch. 91-1; s. 4, ch. 91-429; s. 289, ch. 97-102; s. 62, ch. 98-199; s. 1, ch. 2003-99; s. 980, ch. 2003-261; ss. 61, 83, ch. 2003-267; s. 54, ch. 2003-281; s. 60, ch. 2004-390; s. 6, ch. 2007-199; s. 14, ch. 2008-220; s. 37, ch. 2012-209.
626.8695 Primary adjuster.—
(1) Each person operating an adjusting firm and each location of a multiple location adjusting firm must designate a primary adjuster for each such firm or location and must file with the department the name of such primary adjuster and the address of the firm or location where he or she is the primary adjuster, on a form approved by the department. The designation of the primary adjuster may be changed at the option of the adjusting firm. Any such change is effective upon notification to the department. Notice of change must be sent to the department within 30 days after such change.
(2)(a) For purposes of this section, a “primary adjuster” is the licensed adjuster who is responsible for the hiring and supervision of all individuals within an adjusting firm location who deal with the public and who acts in the capacity of a public adjuster as defined in s. 626.854, or an independent adjuster as defined in s. 626.855. An adjuster may be designated as a primary adjuster for only one adjusting firm location.
(b) For purposes of this section, an “adjusting firm” is a location where an independent or public adjuster is engaged in the business of insurance.
(3) The department may suspend or revoke the license of the primary adjuster if the adjusting firm employs any person who has had a license denied or any person whose license is currently suspended or revoked. However, if a person has been denied a license for failure to pass a required examination, he or she may be employed to perform clerical or administrative functions for which licensure is not required.
(4) The primary adjuster in an unincorporated adjusting firm, or the primary adjuster in an incorporated adjusting firm in which no officer, director, or stockholder is an adjuster, is responsible and accountable for the acts of salaried employees under his or her direct supervision and control while acting on behalf of the adjusting firm. Nothing in this section renders any person criminally liable or subject to any disciplinary proceedings for any act unless the person personally committed or knew or should have known of the act and of the facts constituting a violation of this code.
(5) The department may suspend or revoke the license of any adjuster who is employed by a person whose license is currently suspended or revoked.
(6) An adjusting firm location may not conduct the business of insurance unless a primary adjuster is designated. Failure of the person operating the adjusting firm to designate a primary adjuster for the firm, or for each location, as applicable, on a form prescribed by the department within 30 days after inception of the firm or change of primary adjuster designation, constitutes grounds for requiring the adjusting firm to obtain an adjusting firm license pursuant to s. 626.8696.
(7) Any adjusting firm may request, on a form prescribed by the department, verification from the department of any person’s current licensure status. If a request is mailed to the office within 5 working days after the date an adjuster is hired, and the department subsequently notifies the adjusting firm that an employee’s license is currently suspended, revoked, or has been denied, the license of the primary adjuster shall not be revoked or suspended if the unlicensed person is immediately dismissed from employment as an adjuster with the firm.
History.—s. 25, ch. 92-146; s. 290, ch. 97-102; s. 63, ch. 98-199; s. 981, ch. 2003-261; s. 61, ch. 2004-390.
626.8696 Application for adjusting firm license.—
(1) The application for an adjusting firm license must include:
(a) The name of each majority owner, partner, officer, and director of the adjusting firm.
(b) The resident address of each person required to be listed in the application under paragraph (a).
(c) The name of the adjusting firm and its principal business address.
(d) The location of each adjusting firm office and the name under which each office conducts or will conduct business.
(e) Any additional information that the department requires.
(2) An application for an adjusting firm license must be signed by each owner of the firm. If the firm is incorporated, the application must be signed by the president and secretary of the corporation.
(3) Each application must be accompanied by payment of any applicable fee as prescribed in s. 624.501.
(4) License fees are not refundable.
(5) An adjusting firm required to be licensed pursuant to s. 626.8695 must remain so licensed for a period of 3 years from the date of licensure, unless the license is suspended or revoked. The department may suspend or revoke the adjusting firm’s authority to do business for activities occurring during the time the firm is licensed, regardless of whether the licensing period has terminated.
History.—s. 26, ch. 92-146; s. 982, ch. 2003-261; s. 62, ch. 2004-390.
626.8697 Grounds for refusal, suspension, or revocation of adjusting firm license.—
(1) The department shall deny, suspend, revoke, or refuse to continue the license of any adjusting firm if it finds, as to any adjusting firm or as to any majority owner, partner, manager, director, officer, or other person who manages or controls the firm, that any of the following grounds exist:
(a) Lack by the firm of one or more of the qualifications for the license as specified in this code.
(b) Material misstatement, misrepresentation, or fraud in obtaining the license or in attempting to obtain the license.
(2) The department may, in its discretion, deny, suspend, revoke, or refuse to continue the license of any adjusting firm if it finds that any of the following applicable grounds exist with respect to the firm or any owner, partner, manager, director, officer, or other person who is otherwise involved in the operation of the firm:
(a) Any cause for which issuance of the license could have been refused had it then existed and been known to the department.
(b) Violation of any provision of this code or of any other law applicable to the business of insurance.
(c) Violation of an order or rule of the department, office, or commission.
(d) An owner, partner, manager, director, officer, or other person who manages or controls the firm having been found guilty of or having pleaded guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the laws of the United States or of any state or under the laws of any other country, without regard to whether adjudication was made or withheld by the court.
(e) Failure to inform the department in writing within 30 days after a pleading by an owner, partner, manager, director, officer, or other person managing or controlling the firm of guilty or nolo contendere to, or being convicted or found guilty of, any felony or a crime punishable by imprisonment of 1 year or more under the laws of the United States or of any state, or under the laws of any other country, without regard to whether adjudication was made or withheld by the court.
(f) Knowingly aiding, assisting, procuring, advising, or abetting any person in the violation of or to violate a provision of the insurance code or any order or rule of the department, office, or commission.
(g) Knowingly employing any individual in a managerial capacity or in a capacity dealing with the public who is under an order of revocation or suspension issued by the department.
(h) Committing any of the following acts with such a frequency as to have made the operation of the adjusting firm hazardous to the insurance-buying public or other persons:
1. Misappropriation, conversion, or unlawful or unreasonable withholding of moneys belonging to insurers or insureds or beneficiaries or claimants or to others and received in the conduct of business under the license.
2. Misrepresentation or deception with regard to the business of insurance, dissemination of information, or advertising.
3. Demonstrated lack of fitness or trustworthiness to engage in the business of insurance adjusting arising out of activities related to insurance adjusting or the adjusting firm.
(i) Failure to appoint a primary adjuster.
(3) In lieu of discretionary refusal, suspension, or revocation of an adjusting firm’s license, the department may impose an administrative penalty of up to $1,000 for each violation or ground provided under this section, not to exceed an aggregate amount of $10,000 for all violations or grounds.
(4) If any adjusting firm, having been licensed, thereafter has such license revoked or suspended, the firm shall terminate all adjusting activities while the license is revoked or suspended.
History.—s. 27, ch. 92-146; s. 983, ch. 2003-261; s. 63, ch. 2004-390; s. 38, ch. 2012-209.
626.8698 Disciplinary guidelines for public adjusters and public adjuster apprentices.—The department may deny, suspend, or revoke the license of a public adjuster or public adjuster apprentice, and administer a fine not to exceed $5,000 per act, for any of the following:
(1) Violating any provision of this chapter or a rule or order of the department;
(2) Receiving payment or anything of value as a result of an unfair or deceptive practice;
(3) Receiving or accepting any fee, kickback, or other thing of value pursuant to any agreement or understanding, oral or otherwise; entering into a split-fee arrangement with another person who is not a public adjuster; or being otherwise paid or accepting payment for services that have not been performed;
(4) Violating s. 316.066 or s. 817.234;
(5) Soliciting or otherwise taking advantage of a person who is vulnerable, emotional, or otherwise upset as the result of a trauma, accident, or other similar occurrence; or
(6) Violating any ethical rule of the department.
History.—s. 2, ch. 95-238; s. 984, ch. 2003-261; s. 64, ch. 2004-390; s. 7, ch. 2007-199; s. 15, ch. 2008-220.
626.870 Application for license.—
(1) Application for a license under this part shall be made as provided in s. 626.171 and related sections of this code.
(2) The department shall so prepare the form of the application as to elicit and require from the applicant the information necessary to enable the department to determine whether the applicant possesses the qualifications prerequisite to issuance of the license to the applicant.
(3) The department may, in its discretion, require that the application be supplemented by the certificate or affidavit of such person or persons as it deems necessary for its determination of the applicant’s residence, business reputation, and reputation for trustworthiness. The department shall prescribe and may furnish the forms for such certificates and affidavits.
(4) A license, an appointment, or eligibility that has been suspended may not be reinstated except upon the filing and approval of an application for reinstatement in accordance with s. 626.641. In addition, for reinstatement of a public adjuster’s license, appointment, or eligibility, the individual must pass the public adjuster licensing examination. An application for reinstatement must be accompanied by any applicable examination fee. Successful completion of the examination does not entitle the applicant to have a license reinstated. The application is subject to denial pursuant to ss. 626.207, 626.611, 626.621, and 626.8698. If the department approves an application for reinstatement, the applicant shall be notified that the license will be reinstated upon payment by the applicant of the reinstatement fee contained in s. 624.501(15).
History.—s. 333, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 285, 293, 807, 810, ch. 82-243; ss. 144, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 985, ch. 2003-261; s. 65, ch. 2004-390; s. 16, ch. 2008-220.
626.871 Reappointment after military service.—The department may, without requiring a further written examination, issue an appointment as an adjuster to a formerly licensed and appointed adjuster of this state who held a current adjuster’s appointment at the time of entering service in the Armed Forces of the United States, subject to the following conditions:
(1) The period of military service must not have been in excess of 3 years;
(2) The application for the appointment must be filed with the department and the applicable fee paid, within 12 months following the date of honorable discharge of the applicant from the military service; and
(3) The new appointment will be of the same type and class as that currently effective at the time the applicant entered military service; but, if such type and class of appointment is not being currently issued under this code, the new appointment shall be of that type and class or classes most closely resembling those of the former appointment.
History.—s. 334, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 286, 293, 807, 810, ch. 82-243; ss. 145, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 986, ch. 2003-261; s. 66, ch. 2004-390.
626.872 Temporary license.—
(1) The department may issue a temporary license as an all-lines adjuster, subject to the following conditions:
(a) The applicant must be an employee of an adjuster currently licensed by the department, an authorized insurer, or an established adjusting firm or corporation who is supervised by a currently licensed all-lines adjuster.
(b) The applicant must be a natural person of at least 18 years of age, a bona fide resident of this state, trustworthy, and have a business reputation that would reasonably ensure that the applicant will conduct his or her business as an adjuster fairly and in good faith and without detriment to the public.
(c) The applicant’s employer is responsible for the adjustment acts of the temporary licensee.
(d) The applicable license fee must be paid before issuance of the temporary license.
(e) The temporary license is effective for 1 year, but is subject to earlier termination at the request of the employer, if the licensee fails to take an examination as an all-lines adjuster within 6 months after issuance of the temporary license, or if the temporary license is suspended or revoked by the department.
(2) If during the 1-year temporary license period the applicant passes the examination as for a regular license, the temporary license shall continue in effect as a regular license, but subject to expiration, renewal, or continuation, if the licensee remains continuously employed as referred to in paragraph (1)(a), under the supervision of a licensed adjuster or as an employee of an authorized insurer.
(3) An adjuster licensed under this section may not adjust losses in this state after expiration of the temporary license without having been issued a regular adjuster’s license.
(4) Under the temporary license, the licensee shall have the authority to handle only such classes of business as his or her supervising adjuster is licensed to handle, except that the temporary licensee shall not be permitted by his or her employer to negotiate settlements with the insured or claimant for amounts in excess of $20,000.
(5) The department may not issue a temporary license as an all-lines adjuster to an individual who has held such license in this state.
History.—s. 335, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 287, 293, 807, 810, ch. 82-243; ss. 146, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 291, ch. 97-102; s. 64, ch. 98-199; s. 18, ch. 2001-142; s. 987, ch. 2003-261; s. 67, ch. 2004-390; s. 39, ch. 2012-209.
626.8732 Nonresident public adjuster’s qualifications, bond.—
(1) The department shall, upon application therefor, issue a license to an applicant for a nonresident public adjuster’s license upon determining that the applicant has paid the applicable license fees required under s. 624.501 and:
(a) Is a natural person at least 18 years of age.
(b) Has passed to the satisfaction of the department a written Florida public adjuster’s examination of the scope prescribed in s. 626.241(6).
(c) Is self-employed as a public adjuster or associated with or employed by a public adjusting firm or other public adjuster. Applicants licensed as nonresident public adjusters under this section must be appointed as such in accordance with the provisions of ss. 626.112 and 626.451. Appointment fees in the amount specified in s. 624.501 must be paid to the department in advance. The appointment of a nonresident public adjuster shall continue in force until suspended, revoked, or otherwise terminated, but subject to biennial renewal or continuation by the licensee in accordance with procedures prescribed in s. 626.381 for licensees in general.
(d) Is trustworthy and has such business reputation as would reasonably assure that he or she will conduct his or her business as a nonresident public adjuster fairly and in good faith and without detriment to the public.
(e) Has been licensed and employed as a public adjuster in the applicant’s state of residence on a continual basis for the past year, or, if the applicant’s state of residence does not issue licenses to individuals who act as public adjusters, the applicant has been licensed and employed as a resident insurance company or independent adjuster in his or her state of residence or any other state on a continual basis for the past year.
(2) The applicant shall furnish the following with his or her application:
(a) A complete set of his or her fingerprints. The applicant’s fingerprints must be certified by an authorized law enforcement officer. The department may not authorize an applicant to take the required examination or issue a nonresident public adjuster’s license to the applicant until the department has received a report from the Florida Department of Law Enforcement and the Federal Bureau of Investigation relative to the existence or nonexistence of a criminal history report based on the applicant’s fingerprints.
(b) If currently licensed as a resident public adjuster in the applicant’s state of residence, a certificate or letter of authorization from the licensing authority of the applicant’s state of residence, stating that the applicant holds a current or comparable license to act as a public adjuster and has held the license continuously for the past year. The certificate or letter of authorization must be signed by the insurance commissioner or his or her deputy or the appropriate licensing official and must disclose whether the adjuster has ever had any license or eligibility to hold any license declined, denied, suspended, revoked, or placed on probation or whether an administrative fine or penalty has been levied against the adjuster and, if so, the reason for the action.
(c) If the applicant’s state of residence does not require licensure as a public adjuster and the applicant has been licensed as a resident insurance adjuster in his or her state of residence or any other state, a certificate or letter of authorization from the licensing authority stating that the applicant holds or has held a license to act as such an insurance adjuster and has held the license continuously for the past year. The certificate or letter of authorization must be signed by the insurance commissioner or his or her deputy or the appropriate licensing official and must disclose whether or not the adjuster has ever had any license or eligibility to hold any license declined, denied, suspended, revoked, or placed on probation or whether an administrative fine or penalty has been levied against the adjuster and, if so, the reason for the action.
(3) At the time of application for license as a nonresident public adjuster, the applicant shall file with the department a bond executed and issued by a surety insurer authorized to transact surety business in this state, in the amount of $50,000, conditioned for the faithful performance of his or her duties as a nonresident public adjuster under the license applied for. The bond must be in favor of the department and must specifically authorize recovery by the department of the damages sustained if the licensee commits fraud or unfair practices in connection with his or her business as nonresident public adjuster. The aggregate liability of the surety for all the damages may not exceed the amount of the bond. The bond may not be terminated unless at least 30 days’ written notice is given to the licensee and filed with the department.
(4) The usual and customary records pertaining to transactions under the license of a nonresident public adjuster must be retained for at least 3 years after completion of the adjustment and must be made available in this state to the department upon request. The failure of a nonresident public adjuster to properly maintain records and make them available to the department upon request constitutes grounds for the immediate suspension of the license issued under this section.
(5) After licensure as a nonresident public adjuster, as a condition of doing business in this state, the licensee must annually on or before January 1, on a form prescribed by the department, submit an affidavit certifying that the licensee is familiar with and understands the insurance code and rules adopted thereunder and the provisions of the contracts negotiated or to be negotiated. Compliance with this filing requirement is a condition precedent to the issuance, continuation, reinstatement, or renewal of a nonresident public adjuster’s appointment.
(6) If available, the department shall verify the nonresident applicant’s licensing status through the producer database maintained by the National Association of Insurance Commissioners or its affiliates or subsidiaries.
History.—s. 57, ch. 98-199; s. 989, ch. 2003-261; s. 69, ch. 2004-390; s. 17, ch. 2008-220; s. 41, ch. 2012-209.
626.8734 Nonresident all-lines adjuster license qualifications.—
(1) The department shall issue a license to an applicant for a nonresident all-lines adjuster license upon determining that the applicant has paid the applicable license fees required under s. 624.501 and:
(a) Is a natural person at least 18 years of age.
(b) Has passed to the satisfaction of the department a written Florida all-lines adjuster examination of the scope prescribed in s. 626.241(6); however, the requirement for the examination does not apply to:
1. An applicant who is licensed as an all-lines adjuster in his or her home state if that state has entered into a reciprocal agreement with the department; or
2. An applicant who is licensed as a nonresident all-lines adjuster in a state other than his or her home state and a reciprocal agreement with the appropriate official of the state of licensure has been entered into with the department.
(c) Is licensed as an all-lines adjuster and is self appointed, or appointed and employed by an independent adjusting firm or other independent adjuster, or is an employee of an insurer admitted to do business in this state, a wholly owned subsidiary of an insurer admitted to 1do business in this state, or other insurers under the common control or ownership of such insurers. Applicants licensed as nonresident all-lines adjusters under this section must be appointed as an independent adjuster or company employee adjuster in accordance with ss. 626.112 and 626.451. Appointment fees as specified in s. 624.501 must be paid to the department in advance. The appointment of a nonresident independent adjuster continues in force until suspended, revoked, or otherwise terminated, but is subject to biennial renewal or continuation by the licensee in accordance with s. 626.381 for licensees in general.
(d) Is trustworthy and has such business reputation as would reasonably ensure that he or she will conduct his or her business as a nonresident all-lines adjuster fairly and in good faith and without detriment to the public.
(e) Has had sufficient experience, training, or instruction concerning the adjusting of damages or losses under insurance contracts, other than life and annuity contracts; is sufficiently informed as to the terms and effects of those types of insurance contracts; and possesses adequate knowledge of the laws of this state relating to such contracts as to enable and qualify him or her to engage in the business of insurance adjuster fairly and without injury to the public or any member thereof with whom he or she may have business as an all-lines adjuster.
(2) The applicant must furnish the following with his or her application:
(a) A complete set of his or her fingerprints. The applicant’s fingerprints must be certified by an authorized law enforcement officer.
(b) If currently licensed as an all-lines adjuster in the applicant’s home state, a certificate or letter of authorization from the licensing authority of the applicant’s home state stating that the applicant holds a current license to act as an all-lines adjuster. The certificate or letter of authorization must be signed by the insurance commissioner, or his or her deputy or the appropriate licensing official, and must disclose whether the adjuster has ever had a license or eligibility to hold any license declined, denied, suspended, revoked, or placed on probation or whether an administrative fine or penalty has been levied against the adjuster and, if so, the reason for the action. Such certificate or letter is not required if the nonresident applicant’s licensing status can be verified through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries.
(c) If the applicant’s home state does not require licensure as an all-lines adjuster and the applicant has been licensed as a resident insurance adjuster, agent, broker, or other insurance representative in his or her home state or any other state within the past 3 years, a certificate or letter of authorization from the licensing authority stating that the applicant holds or has held a license to act as an insurance adjuster, agent, or other insurance representative. The certificate or letter of authorization must be signed by the insurance commissioner, or his or her deputy or the appropriate licensing official, and must disclose whether the adjuster, agent, or other insurance representative has ever had a license or eligibility to hold any license declined, denied, suspended, revoked, or placed on probation or whether an administrative fine or penalty has been levied against the adjuster and, if so, the reason for the action. Such certificate or letter is not required if the nonresident applicant’s licensing status can be verified through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries.
(3) The usual and customary records pertaining to transactions under the license of a nonresident all-lines adjuster must be retained for at least 3 years after completion of the adjustment and be made available in this state to the department upon request. The failure of a nonresident all-lines adjuster to properly maintain records and make them available to the department upon request constitutes grounds for the immediate suspension of the license issued under this section.
(4) As a condition of doing business in this state as a nonresident independent adjuster, the appointee must submit an affidavit to the department certifying that the licensee is familiar with and understands the insurance laws and administrative rules of this state and the provisions of the contracts negotiated or to be negotiated. Compliance with this filing requirement is a condition precedent to the issuance, continuation, reinstatement, or renewal of a nonresident independent adjuster’s appointment.
History.—s. 58, ch. 98-199; s. 50, ch. 2001-63; s. 990, ch. 2003-261; s. 70, ch. 2004-390; s. 42, ch. 2012-209.
626.8736 Nonresident independent or public adjusters; service of process.—
(1) Each licensed nonresident public adjuster or all-lines adjuster appointed as an independent adjuster shall appoint the Chief Financial Officer and his or her successors in office as his or her attorney to receive service of legal process issued against such adjuster in this state, upon causes of action arising within this state out of transactions under his license and appointment. Service upon the Chief Financial Officer as attorney constitutes effective legal service upon the nonresident independent or public adjuster.
(2) The appointment of the Chief Financial Officer for service of process is irrevocable as long as there could be any cause of action against the nonresident public adjuster or all-lines adjuster appointed as an independent adjuster arising out of his or her insurance transactions in this state.
(3) Duplicate copies of legal process against the nonresident public adjuster or all-lines adjuster appointed as an independent adjuster shall be served upon the Chief Financial Officer by a person competent to serve a summons.
(4) Upon receiving the service, the Chief Financial Officer shall send one of the copies of the process, by registered mail with return receipt requested, to the defendant nonresident public adjuster or all-lines adjuster appointed as an independent adjuster at his or her last address of record with the department.
(5) The Chief Financial Officer shall keep a record of the day and hour of service upon him or her of all legal process received under this section.
History.—s. 59, ch. 98-199; s. 991, ch. 2003-261; s. 71, ch. 2004-390; s. 43, ch. 2012-209.
626.8737 Nonresident adjusters; retaliatory provision.—When under the laws of any other state any fine, tax, penalty, license fee, deposit of money, or security or other obligation, limitation, or prohibition is imposed upon resident insurance adjusters of this state in connection with the issuance of, and activities under, a nonresident adjuster’s license under the laws of that state as to Florida resident insurance adjusters, then so long as these laws continue in force or are so administered, the same requirements, obligations, limitations, and prohibitions, of whatever kind, shall be imposed upon every insurance adjuster of that other state when doing business in this state under a nonresident adjuster’s license issued under this part.
History.—s. 60, ch. 98-199.
626.8738 Penalty for violation.—In addition to any other remedy imposed pursuant to this code, any person who acts as a resident or nonresident public adjuster or holds himself or herself out to be a public adjuster to adjust claims in this state, without being licensed by the department as a public adjuster and appointed as a public adjuster, commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084. Each act in violation of this section constitutes a separate offense.
History.—s. 61, ch. 98-199; s. 992, ch. 2003-261; s. 72, ch. 2004-390.
626.874 Catastrophe or emergency adjusters.—
(1) In the event of a catastrophe or emergency, the department may issue a license, for the purposes and under the conditions and for the period of emergency as it shall determine, to persons who are residents or nonresidents of this state, who are at least 18 years of age, who are United States citizens or legal aliens who possess work authorization from the United States Bureau of Citizenship and Immigration Services, and who are not licensed adjusters under this part but who have been designated and certified to it as qualified to act as adjusters by all-lines resident adjusters, by an authorized insurer, or by a licensed general lines agent to adjust claims, losses, or damages under policies or contracts of insurance issued by such insurers. The fee for the license is as provided in s. 624.501(12)(c).
(2) If any person not a licensed adjuster who has been permitted to adjust such losses, claims, or damages under the conditions and circumstances set forth in subsection (1), engages in any of the misconduct described in or contemplated by ss. 626.611 and 626.621, the department, without notice and hearing, shall be authorized to issue its order denying such person the privileges granted under this section; and thereafter it shall be unlawful for any such person to adjust any such losses, claims, or damages in this state.
History.—s. 337, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 289, 293, 807, 810, ch. 82-243; ss. 148, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 93, ch. 2002-1; s. 993, ch. 2003-261; s. 62, ch. 2003-267; s. 55, ch. 2003-281; s. 120, ch. 2004-5; s. 73, ch. 2004-390; s. 44, ch. 2012-209.
626.875 Office and records.—
(1) Each appointed independent adjuster and licensed public adjuster must maintain a place of business in this state which is accessible to the public and keep therein the usual and customary records pertaining to transactions under the license. This provision does not prohibit maintenance of such an office in the home of the licensee.
(2) The records of the adjuster relating to a particular claim or loss shall be so retained in the adjuster’s place of business for a period of not less than 3 years after completion of the adjustment. This provision shall not be deemed to prohibit return or delivery to the insurer or insured of documents furnished to or prepared by the adjuster and required by the insurer or insured to be returned or delivered thereto.
History.—s. 338, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 290, 293, 807, 810, ch. 82-243; ss. 149, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 66, ch. 98-199; s. 45, ch. 2012-209.
626.876 Exclusive employment; public adjusters, independent adjusters.—
(1) An individual licensed and appointed as a public adjuster may not be employed during the same period by more than one public adjuster or public adjuster firm or corporation.
(2) An individual licensed as an all-lines adjuster and appointed as an independent adjuster may not be employed during the same period by more than one independent adjuster or independent adjuster firm or corporation.
History.—s. 339, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 291, 293, 807, 810, ch. 82-243; ss. 150, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 46, ch. 2012-209.
626.877 Adjustments to comply with insurance contract and law.—Every adjuster shall adjust or investigate every claim, damage, or loss made or occurring under an insurance contract, in accordance with the terms and conditions of the contract and of the applicable laws of this state.
History.—s. 340, ch. 59-205; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 293, 807, 810, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 67, ch. 98-199.
626.878 Rules; code of ethics.—An adjuster shall subscribe to the code of ethics specified in the rules of the department. The rules shall implement the provisions of this part and specify the terms and conditions of contracts, including a right to cancel, and require practices necessary to ensure fair dealing, prohibit conflicts of interest, and ensure preservation of the rights of the claimant to participate in the adjustment of claims.
History.—s. 341, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 81-282; s. 2, ch. 81-318; ss. 292, 293, 807, 810, ch. 82-243; ss. 151, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 994, ch. 2003-261; s. 63, ch. 2003-267; s. 56, ch. 2003-281; s. 74, ch. 2004-390.
626.879 Pools of insurance adjusters.—The department may, by rule, establish a pool of qualified insurance adjusters. The rules must provide that, if a hurricane occurs or an emergency is declared, the department may assign members of the pool to the affected area and that an insurer may request that a member of the pool adjust claims in the assigned area. The rules may not require that an insurer use those adjusters assigned by the department.
History.—s. 18, ch. 93-410; s. 1185, ch. 2003-261; s. 75, ch. 2004-390.
Note.—Former s. 627.7012.
626.8795 Public adjusters; prohibition of conflict of interest.—A public adjuster may not participate, directly or indirectly, in the reconstruction, repair, or restoration of damaged property that is the subject of a claim adjusted by the licensee; may not engage in any other activities that may be reasonably construed as a conflict of interest, including soliciting or accepting any remuneration from, of any kind or nature, directly or indirectly; and may not have a financial interest in any salvage, repair, or any other business entity that obtains business in connection with any claim that the public adjuster has a contract or an agreement to adjust.
History.—s. 7, ch. 2006-12.
626.8796 Public adjuster contracts; fraud statement.—
(1) All contracts for public adjuster services must be in writing and prominently display the following statement on the contract: “Pursuant to s. 817.234, Florida Statutes, any person who, with the intent to injure, defraud, or deceive an insurer or insured, prepares, presents, or causes to be presented a proof of loss or estimate of cost or repair of damaged property in support of a claim under an insurance policy knowing that the proof of loss or estimate of claim or repairs contains false, incomplete, or misleading information concerning any fact or thing material to the claim commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, Florida Statutes.”
(2) A public adjuster contract relating to a property and casualty claim must contain the full name, permanent business address, and license number of the public adjuster; the full name of the public adjusting firm; and the insured’s full name and street address, together with a brief description of the loss. The contract must state the percentage of compensation for the public adjuster’s services; the type of claim, including an emergency claim, nonemergency claim, or supplemental claim; the signatures of the public adjuster and all named insureds; and the signature date. If all of the named insureds’ signatures are not available, the public adjuster must submit an affidavit signed by the available named insureds attesting that they have authority to enter into the contract and settle all claim issues on behalf of the named insureds. An unaltered copy of the executed contract must be remitted to the insurer within 30 days after execution. A public adjusting firm that adjusts claims primarily for commercial entities with operations in more than one state and that does not directly or indirectly perform adjusting services for insurers or individual homeowners is deemed to comply with the requirements of this subsection if, at the time a proof of loss is submitted, the public adjusting firm remits to the insurer an affidavit signed by the public adjuster or public adjuster apprentice that identifies:
(a) The full name, permanent business address, and license number of the public adjuster or public adjuster apprentice.
(b) The full name of the public adjusting firm.
(c) The insured’s full name and street address, together with a brief description of the loss.
(d) An attestation that the compensation for public adjusting services will not exceed the limitations provided by law.
(e) The type of claim, including an emergency claim, nonemergency claim, or supplemental claim.
History.—s. 18, ch. 2008-220; s. 80, ch. 2009-21; s. 9, ch. 2011-39; s. 47, ch. 2012-209.
626.8797 Proof of loss; fraud statement.—All proof of loss statements must prominently display the following statement: “Pursuant to s. 817.234, Florida Statutes, any person who, with the intent to injure, defraud, or deceive any insurer or insured, prepares, presents, or causes to be presented a proof of loss or estimate of cost or repair of damaged property in support of a claim under an insurance policy knowing that the proof of loss or estimate of claim or repairs contains any false, incomplete, or misleading information concerning any fact or thing material to the claim commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, Florida Statutes.”
History.—s. 19, ch. 2008-220; s. 81, ch. 2009-21.
PART VII
INSURANCE ADMINISTRATORS626.88 Definitions.
626.8805 Certificate of authority to act as administrator.
626.8809 Fidelity bond.
626.8814 Disclosure of ownership or affiliation.
626.8817 Responsibilities of insurance company with respect to administration of coverage insured.
626.882 Agreement between administrator and insurer; required provisions; maintenance of records.
626.883 Administrator as intermediary; collections held in fiduciary capacity; establishment of account; disbursement; payments on behalf of insurer.
626.884 Maintenance of records by administrator; access; confidentiality.
626.885 Notice; statement of charge or premium for coverage.
626.886 Delivery of insurer’s written communications to policyholders.
626.887 Advertising; approval by insurer.
626.888 Adjustment or settlement of claims; compensation of administrator.
626.89 Annual financial statement and filing fee; notice of change of ownership.
626.891 Grounds for suspension or revocation of certificate of authority.
626.892 Order of suspension or revocation of certificate of authority; notice.
626.893 Period of suspension; obligations during suspension; reinstatement.
626.894 Administrative fine in lieu of suspension or revocation.
626.895 Definition of “service company” or “service agent”.
626.896 Servicing requirements for self-insurers and multiple-employer welfare arrangements.
626.897 Application for authorization to act as service company; bond.
626.898 Requirements for retaining authorization as service company; recertification.
626.899 Withdrawal of authorization as service company.
626.8991 Adoption of rules.
626.88 Definitions.—For the purposes of this part, the term:
(1) “Administrator” is any person who directly or indirectly solicits or effects coverage of, collects charges or premiums from, or adjusts or settles claims on residents of this state in connection with authorized commercial self-insurance funds or with insured or self-insured programs which provide life or health insurance coverage or coverage of any other expenses described in s. 624.33(1) or any person who, through a health care risk contract as defined in s. 641.234 with an insurer or health maintenance organization, provides billing and collection services to health insurers and health maintenance organizations on behalf of health care providers, other than any of the following persons:
(a) An employer or wholly owned direct or indirect subsidiary of an employer, on behalf of such employer’s employees or the employees of one or more subsidiary or affiliated corporations of such employer.
(b) A union on behalf of its members.
(c) An insurance company which is either authorized to transact insurance in this state or is acting as an insurer with respect to a policy lawfully issued and delivered by such company in and pursuant to the laws of a state in which the insurer was authorized to transact an insurance business.
(d) A health care services plan, health maintenance organization, professional service plan corporation, or person in the business of providing continuing care, possessing a valid certificate of authority issued by the office, and the sales representatives thereof, if the activities of such entity are limited to the activities permitted under the certificate of authority.
(e) An entity that is affiliated with an insurer and that only performs the contractual duties, between the administrator and the insurer, of an administrator for the direct and assumed insurance business of the affiliated insurer. The insurer is responsible for the acts of the administrator and is responsible for providing all of the administrator’s books and records to the insurance commissioner, upon a request from the insurance commissioner. For purposes of this paragraph, the term “insurer” means a licensed insurance company, health maintenance organization, prepaid limited health service organization, or prepaid health clinic.
(f) A nonresident entity licensed in its state of domicile as an administrator if its duties in this state are limited to the administration of a group policy or plan of insurance and no more than a total of 100 lives for all plans reside in this state.
(g) An insurance agent licensed in this state whose activities are limited exclusively to the sale of insurance.
(h) A person licensed as a managing general agent in this state, whose activities are limited exclusively to the scope of activities conveyed under such license.
(i) An adjuster licensed in this state whose activities are limited to the adjustment of claims.
(j) A creditor on behalf of such creditor’s debtors with respect to insurance covering a debt between the creditor and its debtors.
(k) A trust and its trustees, agents, and employees acting pursuant to such trust established in conformity with 29 U.S.C. s. 186.
(l) A trust exempt from taxation under s. 501(a) of the Internal Revenue Code, a trust satisfying the requirements of ss. 624.438 and 624.439, or any governmental trust as defined in s. 624.33(3), and the trustees and employees acting pursuant to such trust, or a custodian and its agents and employees, including individuals representing the trustees in overseeing the activities of a service company or administrator, acting pursuant to a custodial account which meets the requirements of s. 401(f) of the Internal Revenue Code.
(m) A financial institution which is subject to supervision or examination by federal or state authorities or a mortgage lender licensed under chapter 494 who collects and remits premiums to licensed insurance agents or authorized insurers concurrently or in connection with mortgage loan payments.
(n) A credit card issuing company which advances for and collects premiums or charges from its credit card holders who have authorized such collection if such company does not adjust or settle claims.
(o) A person who adjusts or settles claims in the normal course of such person’s practice or employment as an attorney at law and who does not collect charges or premiums in connection with life or health insurance coverage.
(p) A person approved by the department who administers only self-insured workers’ compensation plans.
(q) A service company or service agent and its employees, authorized in accordance with ss. 626.895-626.899, serving only a single employer plan, multiple-employer welfare arrangements, or a combination thereof.
(r) Any provider or group practice, as defined in s. 456.053, providing services under the scope of the license of the provider or the member of the group practice.
(s) Any hospital providing billing, claims, and collection services solely on its own and its physicians’ behalf and providing services under the scope of its license.
A person who provides billing and collection services to health insurers and health maintenance organizations on behalf of health care providers shall comply with the provisions of ss. 627.6131, 641.3155, and 641.51(4).
(2) “Affiliate” or “affiliated” means an entity or person who directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control with a specified entity or person.
(3) “Control,” including the terms “controlling,” “controlled by,” and “under common control with,” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership or voting securities, by contract other than a commercial contract for goods or nonmanagement services, or otherwise, unless the power is the result of an official position with or corporate office held by the person. Control shall be presumed to exist if any person directly or indirectly owns, controls, holds with the power to vote, or holds proxies representing 10 percent or more of the voting securities of any other person.
(4) “GAAP” means United States generally accepted accounting principles consistently applied.
(5) “Insurer” includes an authorized commercial self-insurance fund and includes any person undertaking to provide life or health insurance coverage or coverage of any of the other expenses described in s. 624.33(1).
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 27, ch. 88-166; ss. 206, 207, ch. 90-363; s. 184, ch. 91-108; s. 4, ch. 91-429; s. 65, ch. 2002-194; s. 4, ch. 2002-389; s. 995, ch. 2003-261; s. 1, ch. 2005-182.
626.8805 Certificate of authority to act as administrator.—
(1) It is unlawful for any person to act as or hold himself or herself out to be an administrator in this state without a valid certificate of authority issued by the office pursuant to ss. 626.88-626.894. To qualify for and hold authority to act as an administrator in this state, an administrator must otherwise be in compliance with this code and with its organizational agreement. The failure of any person to hold such a certificate while acting as an administrator shall subject such person to a fine of not less than $5,000 or more than $10,000 for each violation.
(2) The administrator shall file with the office an application for a certificate of authority upon a form to be adopted by the commission and furnished by the office, which application shall include or have attached the following information and documents:
(a) All basic organizational documents of the administrator, such as the articles of incorporation, articles of association, partnership agreement, trade name certificate, trust agreement, shareholder agreement, and other applicable documents, and all amendments to those documents.
(b) The bylaws, rules, and regulations or similar documents regulating the conduct or the internal affairs of the administrator.
(c) The names, addresses, official positions, and professional qualifications of the individuals who are responsible for the conduct of the affairs of the administrator, including all members of the board of directors, board of trustees, executive committee, or other governing board or committee, the principal officers in the case of a corporation, the partners or members in the case of a partnership or association, and any other person who exercises control or influence over the affairs of the administrator.
(d) Audited annual financial statements for the 2 most recent fiscal years which prove that the applicant has a positive net worth. If the applicant has been in existence for less than 2 fiscal years, the application must include financial statements or reports, certified by an officer of the applicant and prepared in accordance with GAAP, for any completed fiscal years and for any month during the current fiscal year for which such financial statements or reports have been completed. An audited financial statement or report prepared on a consolidated basis must include a columnar consolidating or combining worksheet that shall be filed with the report and must comply with the following:
1. Amounts shown on the consolidated audited financial report must be shown on the worksheet;
2. Amounts for each entity shall be stated separately; and
3. Explanations of consolidating and eliminating entries.
The applicant shall also include such other information as the office requires in order to review the current financial condition of the applicant.
(e) A statement describing the business plan, including information on staffing levels and activities proposed in this state and nationwide. The plan must provide details setting forth the applicant’s capability for providing a sufficient number of experienced and qualified personnel in the areas of claims processing, recordkeeping, and underwriting.
(f) If the applicant is not currently acting as an administrator, a statement of the amounts and sources of the funds available for organization expenses and the proposed arrangements for reimbursement and compensation of incorporators or other principals.
(3) The applicant shall make available for inspection by the office copies of all contracts with insurers or other persons utilizing the services of the administrator.
(4) The office shall not issue a certificate of authority if it determines that the administrator or any principal thereof is not competent, trustworthy, financially responsible, or of good personal and business reputation or has had an insurance license denied for cause by any state.
(5) A certificate of authority issued under this section shall remain valid, unless suspended or revoked by the office, so long as the certificateholder continues in business in this state.
(6) A certificate of authority issued under this section shall indicate that the administrator is authorized to administer commercial self-insurance funds or life and health programs or both, except that a certificate of authority issued prior to October 1, 1988, does not authorize the administration of commercial self-insurance funds.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 28, ch. 88-166; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 293, ch. 97-102; s. 996, ch. 2003-261; s. 2, ch. 2005-182.
626.8809 Fidelity bond.—An administrator shall have and keep in full force and effect a fidelity bond equal to at least 10 percent of the amount of the funds handled or managed annually by the administrator. However, the office may not require a bond greater than $500,000 unless the office, after due notice to all interested parties and opportunity for hearing and after consideration of the record, requires an amount in excess of $500,000 but not more than 10 percent of the amount of the funds handled or managed annually by the administrator.
History.—ss. 29, 64, ch. 88-166; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 997, ch. 2003-261.
626.8814 Disclosure of ownership or affiliation.—Each administrator shall identify to the office any ownership interest or affiliation of any kind with any insurance company responsible for providing benefits directly or through reinsurance to any plan for which the administrator provides administrative services.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 998, ch. 2003-261.
626.8817 Responsibilities of insurance company with respect to administration of coverage insured.—
(1) If an insurer uses the services of an administrator, the insurer is responsible for determining the benefits, premium rates, underwriting criteria, and claims payment procedures applicable to the coverage and for securing reinsurance, if any. The rules pertaining to these matters shall be provided, in writing, by the insurer to the administrator. The responsibilities of the administrator as to any of these matters shall be set forth in the written agreement between the administrator and the insurer.
(2) It is the sole responsibility of the insurer to provide for competent administration of its programs.
(3) In cases in which an administrator administers benefits for more than 100 certificateholders on behalf of an insurer, the insurer shall, at least semiannually, conduct a review of the operations of the administrator. At least one such review must be an onsite audit of the operations of the administrator.
(4) For purposes of this section, the term “insurer” means a licensed insurance company, health maintenance organization, prepaid limited health service organization, or prepaid health clinic.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 3, ch. 2005-182.
626.882 Agreement between administrator and insurer; required provisions; maintenance of records.—
(1) No person may act as an administrator without a written agreement between such person as administrator and an insurer.
(2)(a) The written agreement shall contain provisions which include the requirements of ss. 626.883-626.888, except as those requirements do not apply to the functions performed by the administrator.
(b) The written agreement shall contain a provision with respect to the underwriting or other standards pertaining to business underwritten by the insurer.
(3) Such written agreement shall be retained as part of the official records of both the administrator and the insurer for the duration of the agreement and for 5 years thereafter.
(4) If a policy is issued to a trustee or trustees, a copy of the trust agreement and any amendments to that agreement shall be furnished to the insurer by the administrator and shall be retained as part of the official records of both the administrator and the insurer for the duration of the policy and for 5 years thereafter.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.883 Administrator as intermediary; collections held in fiduciary capacity; establishment of account; disbursement; payments on behalf of insurer.—
(1) If an insurer utilizes the services of an administrator under the terms of a written agreement, the payment to the administrator of any premiums or charges for insurance by or on behalf of the insured shall be deemed to have been received by the insurer, and return premiums or claim payments forwarded by the insurer to the administrator shall not be deemed to have been paid to the insured or claimant until such payments are received by the insured or claimant. Nothing in this part limits any right of the insurer against the administrator resulting from the failure of the administrator to make payments to the insurer, insureds, or claimants.
(2) All insurance charges or premiums collected by an administrator on behalf of or for an insurer or insurers, and return premiums received from such insurer or insurers, shall be held by the administrator in a fiduciary capacity. Such funds shall be immediately remitted to the person or persons entitled to them or shall be deposited promptly in a fiduciary account established and maintained by the administrator in a financial institution.
(3) If charges or premiums deposited in a fiduciary account have been collected on behalf of or for more than one insurer, the administrator shall keep records clearly recording the deposits in and withdrawals from such account on behalf of or for each insurer. The administrator shall, upon request of an insurer, furnish such insurer with copies of records pertaining to deposits and withdrawals on behalf of or for such insurer.
(4) The administrator may not pay any claim by withdrawals from a fiduciary account. Withdrawals from such account shall be made as provided in the written agreement between the administrator and the insurer for any of the following:
(a) Remittance to an insurer entitled to such remittance.
(b) Deposit in an account maintained in the name of such insurer.
(c) Transfer to and deposit in a claims-paying account, with claims to be paid as provided by such insurer.
(d) Payment to a group policyholder for remittance to the insurer entitled to such remittance.
(e) Payment to the administrator of the commission, fees, or charges of the administrator.
(f) Remittance of return premium to the person or persons entitled to such return premium.
(5) All claims paid by the administrator from funds collected on behalf of the insurer shall be paid only on drafts of, and as authorized by, such insurer.
(6) All payments to a health care provider by a fiscal intermediary for noncapitated providers must include an explanation of services being reimbursed which includes, at a minimum, the patient’s name, the date of service, the procedure code, the amount of reimbursement, and the identification of the plan on whose behalf the payment is being made. For capitated providers, the statement of services must include the number of patients covered by the contract, the rate per patient, the total amount of the payment, and the identification of the plan on whose behalf the payment is being made.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 2, ch. 99-275; s. 173, ch. 99-397.
626.884 Maintenance of records by administrator; access; confidentiality.—
(1) Every administrator shall maintain in such administrator’s principal administrative office for the duration of the written agreement and for 5 years thereafter adequate books and records of all transactions among such administrator, insurers, and insured persons. Such books and records shall be maintained in accordance with prudent standards of insurance recordkeeping.
(2) The office shall have access to books and records maintained by the administrator for the purpose of examination, audit, and inspection. Information contained in such books and records is confidential and exempt from the provisions of s. 119.07(1) if the disclosure of such information would reveal a trade secret as defined in s. 688.002. However, the office may use such information in any proceeding instituted against the administrator.
(3) The insurer shall retain the right of continuing access to books and records maintained by the administrator sufficient to permit the insurer to fulfill all of its contractual obligations to insured persons, subject to any restrictions in the written agreement between the insurer and the administrator on the proprietary rights of the parties in such books and records.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 8, ch. 93-80; s. 376, ch. 96-406; s. 999, ch. 2003-261.
626.885 Notice; statement of charge or premium for coverage.—
(1) When the services of an administrator are utilized, the administrator shall provide a written notice approved by the insurer to insured individuals advising them of the identity of, and relationship among, the administrator, the policyholder, and the insurer.
(2) When an administrator collects funds, the administrator shall identify and state separately in writing, to the person paying to the administrator any charge or premium for coverage, the amount of any such charge or premium specified by the insurer for such coverage.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.886 Delivery of insurer’s written communications to policyholders.—Any policies, certificates, booklets, termination notices, or other written communications delivered by the insurer to the administrator for delivery to its policyholders shall be delivered by the administrator promptly after receipt of instructions from the insurer to deliver them.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.887 Advertising; approval by insurer.—An administrator may use only such advertising pertaining to the business underwritten by an insurer as has been approved in writing by such insurer in advance of its use.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.888 Adjustment or settlement of claims; compensation of administrator.—Compensation to an administrator for any policies in which the administrator adjusts or settles claims shall in no way be contingent on claims experience. This section does not prevent the compensation of an administrator from being based on premiums or charges collected or the number of claims paid or processed.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.89 Annual financial statement and filing fee; notice of change of ownership.—
(1) Each authorized administrator shall file with the office a full and true statement of its financial condition, transactions, and affairs. The statement shall be filed annually on or before March 1 or within such extension of time therefor as the office for good cause may have granted and shall be for the preceding calendar year. The statement shall be in such form and contain such matters as the commission prescribes and shall be verified by at least two officers of such administrator. An administrator whose sole stockholder is an association representing health care providers which is not an affiliate of an insurer, an administrator of a pooled governmental self-insurance program, or an administrator that is a university may submit the preceding fiscal year’s statement within 2 months after its fiscal year end.
(2) Each authorized administrator shall also file an audited financial statement performed by an independent certified public accountant. The audited financial statement shall be filed with the office on or before June 1 for the preceding calendar year ending December 31. An administrator whose sole stockholder is an association representing health care providers which is not an affiliate of an insurer, an administrator of a pooled governmental self-insurance program, or an administrator that is a university may submit the preceding fiscal year’s audited financial statement within 5 months after the end of its fiscal year. An audited financial statement prepared on a consolidated basis must include a columnar consolidating or combining worksheet that must be filed with the statement and must comply with the following:
(a) Amounts shown on the consolidated audited financial statement must be shown on the worksheet;
(b) Amounts for each entity must be stated separately; and
(c) Explanations of consolidating and eliminating entries must be included.
(3) At the time of filing its annual statement, the administrator shall pay a filing fee in the amount specified in s. 624.501 for the filing of an annual statement by an insurer.
(4) In addition, the administrator shall immediately notify the office of any material change in its ownership.
(5) The commission may by rule require all or part of the statements or filings required under this section to be submitted by electronic means in a computer-readable form compatible with the electronic data format specified by the commission.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1000, ch. 2003-261; s. 4, ch. 2005-182; s. 1, ch. 2007-148; s. 3, ch. 2009-116.
626.891 Grounds for suspension or revocation of certificate of authority.—
(1) The certificate of authority of an administrator shall be suspended or revoked if the office determines that the administrator:
(a) Is in an unsound financial condition;
(b) Has used or is using such methods or practices in the conduct of its business so as to render its further transaction of business in this state hazardous or injurious to insured persons or the public; or
(c) Has failed to pay any judgment rendered against it in this state within 60 days after the judgment has become final.
(2) The office may, in its discretion, suspend or revoke the certificate of authority of an administrator if it finds that the administrator:
(a) Has violated any lawful rule or order of the commission or office or any provision of this chapter;
(b) Has refused to be examined or to produce its accounts, records, and files for examination, or if any of its officers has refused to give information with respect to its affairs or has refused to perform any other legal obligation as to such examination, when required by the office;
(c) Has, without just cause, refused to pay proper claims or perform services arising under its contracts or has, without just cause, compelled insured persons to accept less than the amount due them or to employ attorneys or bring suit against the administrator to secure full payment or settlement of such claims;
(d) Is or was affiliated with and under the same general management or interlocking directorate or ownership as another administrator which transacts business in this state without having a certificate of authority;
(e) At any time fails to meet any qualification for which issuance of the certificate could have been refused had such failure then existed and been known to the office;
(f) Has been convicted of, or has entered a plea of guilty or nolo contendere to, a felony relating to the business of insurance or insurance administration in this state or in any other state without regard to whether adjudication was withheld; or
(g) Is under suspension or revocation in another state.
(3) The office may, pursuant to s. 120.60, in its discretion and without advance notice or hearing thereon, immediately suspend the certificate of any administrator if it finds that one or more of the following circumstances exist:
(a) The administrator is insolvent or impaired.
(b) The fidelity bond required by s. 626.8809 is not maintained.
(c) A proceeding for receivership, conservatorship, rehabilitation, or other delinquency proceeding regarding the administrator has been commenced in any state.
(d) The financial condition or business practices of the administrator otherwise pose an imminent threat to the public health, safety, or welfare of the residents of this state.
(4) The violation of this part by any insurer shall be a ground for suspension or revocation of the certificate of authority of that insurer in this state.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 30, ch. 88-166; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 28, ch. 92-146; s. 1001, ch. 2003-261.
626.892 Order of suspension or revocation of certificate of authority; notice.—
(1) The suspension or revocation of a certificate of authority of an administrator shall be effected by order of the office mailed to the administrator by registered or certified mail.
(2) In its discretion, the office may cause notice of any such revocation or suspension to be published in one or more newspapers of general circulation published in this state.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 11, ch. 85-62; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1002, ch. 2003-261.
626.893 Period of suspension; obligations during suspension; reinstatement.—
(1) A certificate of authority of an administrator shall be suspended for such period, not to exceed 1 year, as is fixed in the order of suspension, unless such suspension or the order upon which the suspension is based is modified, rescinded, or reversed.
(2) During the period of suspension, the administrator shall file its annual statement and pay fees as required under this part as if the certificate had continued in full force.
(3) Upon expiration of the suspension period, if within such period the certificate has not otherwise terminated, the certificate shall automatically be reinstated, unless the causes of the suspension have not been removed or the administrator is otherwise not in compliance with the requirements of this part.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.894 Administrative fine in lieu of suspension or revocation.—
(1) If the office finds that one or more grounds exist for the suspension or revocation of a certificate of authority issued under this part, the office may, in lieu of such suspension or revocation, impose a fine upon the administrator.
(2) With respect to any nonwillful violation, such fine may not exceed $1,000 per violation. In no event may such fine exceed an aggregate amount of $5,000 for all nonwillful violations arising out of the same action. When an administrator discovers a nonwillful violation, the administrator shall correct the violation and, if restitution is due, the restitution shall include interest at the rate of 12 percent per year from either the date of the violation or the date of inception of the policy of the affected person, at the option of the administrator. The restitution may be a credit against future premiums due, provided that the interest shall accumulate until the premiums are due. If the amount of restitution due to any person is $50 or more, and the administrator wishes to credit it against future premiums, the administrator shall notify such person that he or she may receive a check instead of a credit. If the credit is on a policy which is not renewed, the administrator shall pay the restitution to the person to whom it is due.
(3) With respect to any knowing and willful violation of a lawful order or rule of the office or commission or a provision of this part, the office may impose a fine upon the administrator in an amount not to exceed $5,000 for each such violation. In no event may such fine exceed an aggregate amount of $25,000 for all knowing and willful violations arising out of the same action. In addition to such fine, the administrator shall make restitution when due in accordance with the provisions of subsection (2).
(4) The failure of an administrator to make restitution when due as required under this section constitutes a willful violation of this part. However, if an administrator in good faith is uncertain as to whether any restitution is due or as to the amount of restitution due, it shall promptly notify the office of the circumstances; and the failure to make restitution pending a determination of whether restitution is due or the amount of restitution due will not constitute a violation of this part.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 12, ch. 85-62; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 294, ch. 97-102; s. 1003, ch. 2003-261.
626.895 Definition of “service company” or “service agent”.—For the purpose of this part, a “service company” is any business entity which has met all the requirements of ss. 626.895-626.899, which does not control funds, and which has obtained office approval to contract with self-insurers or multiple-employer welfare arrangements for the purpose of providing all or any part of the services necessary to establish and maintain a multiple-employer welfare arrangement as defined in s. 624.437(1). The term “service agent” is synonymous with the term “service company” as used in this part.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1004, ch. 2003-261.
626.896 Servicing requirements for self-insurers and multiple-employer welfare arrangements.—
(1) Each individual self-insurer or multiple-employer welfare arrangement is required to provide proof of compliance with the provisions of this section regarding servicing requirements.
(2) It is the sole responsibility of each individual self-insurer or multiple-employer welfare arrangement to provide for competent persons to service its program in the areas of claims adjusting and underwriting. If the individual self-insurer or multiple-employer welfare arrangement is unable or unwilling to provide any or all of these services through the use of its own employees, it shall contract with outside companies which have the necessary qualifications to provide these services.
(3) It is the responsibility of the self-insurer or multiple-employer welfare arrangement to notify the office within 90 days of changing its method of fulfilling its servicing requirements from those which were previously filed with the office.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1005, ch. 2003-261.
626.897 Application for authorization to act as service company; bond.—
(1) An application by any business for approval to provide underwriting and claims adjusting services to self-insurers or multiple-employer welfare arrangements shall be made on appropriate forms. Applications shall be approved pursuant to s. 120.60.
(2) Any business desiring to act as a service company for individual self-insurers or multiple-employer welfare arrangements shall be approved by the office. Any business acting as a service company prior to October 1, 1983, will be approved as a service company upon complying with the filing requirements of this section and s. 626.898. The failure of any person to obtain such approval while acting as a service company shall subject such person to a fine of not less than $5,000 or more than $10,000 for each violation.
(3) Any business making application to qualify as a service company shall provide proof that it meets the following conditions before approval may be granted:
(a) The owners of the business, including members of a copartnership, the officers of a corporation, and any person exercising control or influence over the affairs of the service company, must not have been convicted of felonies or of crimes involving fraud, embezzlement, or theft or have been materially responsible for the insolvency of any self-funded plan.
(b) The business must have a sufficient number of experienced and qualified claims personnel employed full time to meet the needs of all self-insurers or multiple-employer welfare arrangements with which it intends to contract.
(c) The business must have a sufficient number of experienced and qualified personnel employed full time in the area of underwriting to meet the needs of all self-insurers or multiple-employer welfare arrangements with which it intends to contract. In this context, the term “underwriting” includes, but is not limited to, the overall planning and coordinating of a self-insurance program or a multiple-employer welfare arrangement, the ability to procure bonds and excess insurance, the ability to provide summary data regarding the cost to the self-insurer or multiple-employer welfare arrangement of providing benefits, including the frequency and distribution by type and cause, and the skill to make recommendations to individual self-insurers and multiple-employer welfare arrangements regarding the correction of any deficiencies that arise in the self-insurance programs.
(4) In support of its application, the business shall submit summary information concerning its organization and staff sufficient to establish fulfillment of the requirements of this section.
(5) Any service company which seeks authorization must certify that it has the recordkeeping capabilities specified before any authorization may be granted.
(6) Any business applying to be a service company which business is owned by or affiliated with an authorized insurance company may provide proof of its ability to deliver claims adjusting and underwriting services by certifying that employees of the service company or employees of the affiliated insurance company will deliver such services.
(7) The service company shall have and keep in full force and effect a fidelity bond equal to 10 percent of the claims processed annually and coverage for errors and omissions in an equal amount not to exceed $250,000 for each.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; s. 13, ch. 85-62; ss. 152, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1006, ch. 2003-261.
626.898 Requirements for retaining authorization as service company; recertification.—
(1) No person may act as a service company without a written agreement between such person as service company and a self-insurer or multiple-employer welfare arrangement. Such written agreement shall be retained as part of the official records of each party for the duration of the agreement and for 5 years thereafter.
(2) Each service company shall file, within 30 days of entering into a contract for servicing, either a copy of its service contract or a certification attesting to the fact that the service company has provided sufficient services to fulfill the conditions specified in this act. Such certification shall be made on forms provided.
(3)(a) Each service company shall maintain at one or more locations within this state copies of all contracts with each self-insurer or multiple-employer welfare arrangement that it services and records relating thereto which are sufficient in type and quantity to verify the accuracy and completeness of all reports and documents submitted to the office pursuant to this part. In the event that the service company has its records distributed in multiple locations, it shall inform the office as to the location of each type of record, as well as the location of specific records for the self-insurers or multiple-employer welfare arrangements it services.
(b) These records shall be open to inspection by representatives of the office during regular business hours. All records shall be retained according to the schedule adopted by the commission for similar documents. The location of these records shall be made known to the office as necessary.
(4) The self-insurer or multiple-employer welfare arrangement shall have the right of continuing access to books and records maintained by the service company sufficient to permit the self-insurer or arrangement to fulfill all of its contractual obligations to covered employees, subject to any restrictions in the written agreement between the self-insurer or arrangement and the service company with respect to the proprietary rights of the parties in such books and records.
(5) A service company may use only such advertising pertaining to a self-insured plan as has been approved in writing by an individual self-insurer or multiple-employer welfare arrangement.
(6) Any policies, certificates, booklets, termination notices, or other written communications delivered by any self-insurer to the service company for delivery to participants shall be delivered by the service company promptly after receipt of instructions from the self-insurer to deliver them.
(7) As to the servicing of coverage, the self-insurer or multiple-employer welfare arrangement, not the service company, is responsible for determining the benefits, rates, underwriting criteria, and claims payment procedures.
(8) The service company shall disclose to the self-insurer or multiple-employer welfare arrangement all charges, fees, and commissions received from all services in connection with the provision of administrative services for such self-insurer or arrangement, including any fees or commissions paid by insurers providing reinsurance.
(9) Compensation to a service company for claims adjustment or settlement shall in no way be contingent on claims experience. This section does not prevent the compensation of a service company from being based on premiums or charges collected or the number of claims paid or processed.
(10) Each service company shall identify to the office any ownership interest or affiliation of any kind with any insurance company responsible directly or through reinsurance for providing benefits to any plan for which it provides services.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1007, ch. 2003-261.
626.899 Withdrawal of authorization as service company.—The failure to comply with any provision of ss. 626.895-626.899 or with any rule or any order of the commission or office within the time prescribed shall be considered good cause for withdrawal of the certificate of approval. The office shall by registered or certified mail give to the service company prior written notice of such withdrawal. The service company shall have 30 days from the date of mailing to request a hearing. The failure to request a hearing within the time prescribed shall result in the withdrawal becoming effective 45 days from the date of mailing of the original notice. In no event shall the withdrawal of the certificate of approval be effective prior to the date upon which a hearing, if requested, is scheduled. Copies of such notice of withdrawal of a certificate of approval shall be furnished by the office to each self-funded program serviced.
History.—s. 4, ch. 83-203; s. 3, ch. 84-94; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1008, ch. 2003-261.
626.8991 Adoption of rules.—The commission may adopt rules necessary to administer this part.
History.—s. 5, ch. 2005-182.
PART VIII
UNAUTHORIZED INSURERS ANDSURPLUS LINES
626.901 Representing or aiding unauthorized insurer prohibited.
626.902 Penalty for representing unauthorized insurer.
626.903 Suits by unauthorized insurers prohibited.
626.904 Unauthorized Insurers Process Law; short title; interpretation.
626.905 Purpose of Unauthorized Insurers Process Law.
626.906 Acts constituting Chief Financial Officer as process agent.
626.907 Service of process; judgment by default.
626.908 Defense of action by unauthorized insurer or person representing or aiding such insurer; damages and attorney fee.
626.909 Jurisdiction of office and department; service of process on Secretary of State.
626.910 Penalty for violation by unauthorized insurers and persons representing or aiding such insurers.
626.911 Attorney’s fee.
626.912 Exemptions from ss. 626.904-626.911.
626.913 Surplus Lines Law; short title; purposes.
626.914 Definitions.
626.915 Surplus lines insurance authorized.
626.916 Eligibility for export.
626.917 Eligibility for export; wet marine and transportation, aviation risks.
626.918 Eligible surplus lines insurers.
626.9181 Levy upon deposit.
626.919 Withdrawal of eligibility; surplus lines insurer.
626.9201 Notice of cancellation or nonrenewal.
626.921 Florida Surplus Lines Service Office.
626.922 Evidence of the insurance; changes; penalty.
626.923 Filing copy of policy or certificate.
626.924 Information required on contract.
626.925 Surplus lines insurance valid.
626.926 Liability of insurer as to losses and unearned premiums.
626.927 Licensing of surplus lines agent.
626.9271 Temporary license; death, disability, absence of surplus lines agent.
626.9272 Licensing of nonresident surplus lines agents.
626.929 Origination, acceptance, placement of surplus lines business.
626.9295 Corporations, liability of agent.
626.930 Records of surplus lines agent.
626.931 Agent affidavit and insurer reporting requirements.
626.932 Surplus lines tax.
626.9325 Service fee.
626.933 Collection of tax and service fee.
626.934 Accounting for funds; contingent commissions.
626.935 Suspension, revocation, or refusal of surplus lines agent’s license.
626.936 Failure to file reports or pay tax or service fee; administrative penalty.
626.9361 Failure to file report; administrative penalty.
626.9362 Cooperative reciprocal agreement authorized for collection and allocation of certain nonadmitted insurance taxes.
626.937 Actions against insurer; service of process.
626.9371 Payment of premiums and claims.
626.9372 Disclosure statement of certain information required; liability claims.
626.9373 Attorney’s fees.
626.9374 Liability of insureds; deductible and coinsurance.
626.938 Report and tax of independently procured coverages.
626.939 Records produced on order.
626.901 Representing or aiding unauthorized insurer prohibited.—
(1) No person shall, from offices or by personnel or facilities located in this state, or in any other state or country, directly or indirectly act as agent for, or otherwise represent or aid on behalf of another, any insurer not then authorized to transact such insurance in this state in:
(a) The solicitation, negotiation, procurement, or effectuation of insurance or annuity contracts, or renewals thereof;
(b) The dissemination of information as to coverage or rates;
(c) The forwarding of applications;
(d) The delivery of policies or contracts;
(e) The inspection of risks;
(f) The fixing of rates;
(g) The investigation or adjustment of claims or losses; or
(h) The collection or forwarding of premiums;
or in any other manner represent or assist such an insurer in the transaction of insurance with respect to subjects of insurance resident, located, or to be performed in this state. If the property or risk is located in any other state, then, subject to the provisions of subsection (4), insurance may only be written with or placed in an insurer authorized to do such business in such state or in an insurer with which a licensed insurance broker of such state may lawfully place such insurance.
(2) If an unauthorized insurer fails to pay in full or in part any claim or loss within the provisions of any insurance contract which is entered into in violation of this section, any person who knew or reasonably should have known that such contract was entered into in violation of this section and who solicited, negotiated, took application for, or effectuated such insurance contract is liable to the insured for the full amount of the claim or loss not paid.
(3) No insurance contract entered into in violation of this section shall be deemed to have been rendered invalid thereby.
(4) This section does not apply to:
(a) Matters authorized to be done by the office under the Unauthorized Insurers Process Law, ss. 626.904-626.912.
(b) Surplus lines insurance when written pursuant to the Surplus Lines Law, ss. 626.913-626.937.
(c) Transactions as to which a certificate of authority is not required of an insurer, as stated in s. 624.402.
(d) Independently procured coverage written pursuant to s. 626.938 which is not solicited, marketed, negotiated, or sold in this state.
(5) The office or department may, pursuant to s. 120.569 and in its discretion, issue an immediate final order to cease and desist to any person or entity that violates this section. The Legislature finds that a violation of this section constitutes an imminent and immediate threat to the health, safety, and welfare of the residents of this state.
(6) The office may investigate the accounts, records, documents, and transactions pertaining to the activities of any unauthorized insurer or person, as defined in s. 624.04, which is or may be aiding or representing an unauthorized insurer.
History.—s. 342, ch. 59-205; ss. 13, 35, ch. 69-106; s. 1, ch. 71-18; s. 2, ch. 81-318; ss. 294, 318, 807, ch. 82-243; s. 17, ch. 89-360; ss. 153, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1009, ch. 2003-261; s. 1, ch. 2005-144.
626.902 Penalty for representing unauthorized insurer.—
(1) In addition to any other penalties provided in the insurance code:
(a) Any insurance agent licensed in this state who in this state knowingly represents or aids an unauthorized insurer in violation of s. 626.901 commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(b) Any person other than an insurance agent licensed in this state who in this state represents or aids an unauthorized insurer in violation of s. 626.901 commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(c) Any person who commits a subsequent violation of this section commits a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(2) In addition to the penalties provided for in subsection (1), such violator shall be liable, personally, jointly and severally with any other person or persons liable therefor, for payment of taxes payable on account of such insurance under s. 626.938.
(3) This section does not apply to actions of a person who is assisting the office at its direction in the administration of its responsibilities under ss. 626.904-626.912, the Unauthorized Insurers Process Law.
History.—s. 343, ch. 59-205; s. 643, ch. 71-136; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 4, ch. 95-340; s. 39, ch. 2002-206; s. 2, ch. 2005-144.
626.903 Suits by unauthorized insurers prohibited.—As to transactions not permitted under s. 624.402, no unauthorized insurer shall institute, file, or maintain, or cause to be instituted, filed, or maintained, any suit, action, or proceeding in this state to enforce any right, claim, or demand arising out of any insurance transaction in this state.
History.—s. 344, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.904 Unauthorized Insurers Process Law; short title; interpretation.—
(1) Sections 626.904-626.912 may be cited as the “Unauthorized Insurers Process Law.”
(2) Such law shall be so interpreted as to effectuate its general purpose to make uniform the law of those states which enact it.
History.—s. 345, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.905 Purpose of Unauthorized Insurers Process Law.—The purpose of the Unauthorized Insurers Process Law is to subject certain insurers and persons representing or aiding such insurers to the jurisdiction of courts of this state in suits by or on behalf of insureds or beneficiaries under insurance contracts. The Legislature declares that it is a subject of concern that many residents of this state hold policies of insurance issued or delivered in the state by insurers while not authorized to do business in this state, thus presenting to such residents the often insuperable obstacle of resorting to distant forums for the purpose of asserting legal rights under such policies. In furtherance of such state interest, the Legislature herein provides a method of substituted service of process upon unauthorized insurers and persons representing or aiding such insurers, and declares that in so doing it exercises its power to protect its residents and to define, for the purpose of this chapter, what constitutes doing business in this state, and also exercises powers and privileges available to the state by virtue of Pub. L. No. 15, 79th Congress of the United States, chapter 20, 1st session, s. 340, as amended, which declares that the business of insurance and every person engaged therein shall be subject to the laws of the several states.
History.—s. 346, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 154, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.906 Acts constituting Chief Financial Officer as process agent.—Any of the following acts in this state, effected by mail or otherwise, by an unauthorized foreign insurer, alien insurer, or person representing or aiding such an insurer is equivalent to and shall constitute an appointment by such insurer or person representing or aiding such insurer of the Chief Financial Officer to be its true and lawful attorney, upon whom may be served all lawful process in any action, suit, or proceeding instituted by or on behalf of an insured or beneficiary, arising out of any such contract of insurance; and any such act shall be signification of the insurer’s or person’s agreement that such service of process is of the same legal force and validity as personal service of process in this state upon such insurer or person representing or aiding such insurer:
(1) The issuance or delivery of contracts of insurance to residents of this state or to corporations authorized to do business therein;
(2) The solicitation of applications for such contracts;
(3) The collection of premiums, membership fees, assessments, or other considerations for such contracts; or
(4) Any other transaction of insurance.
History.—s. 347, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 155, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 295, ch. 97-102; s. 1010, ch. 2003-261.
626.907 Service of process; judgment by default.—
(1) Service of process upon an insurer or person representing or aiding such insurer pursuant to s. 626.906 shall be made by delivering to and leaving with the Chief Financial Officer or some person in apparent charge of his or her office two copies thereof. The Chief Financial Officer shall forthwith mail by registered mail one of the copies of such process to the defendant at the defendant’s last known principal place of business and shall keep a record of all process so served upon him or her. The service of process is sufficient, provided notice of such service and a copy of the process are sent within 10 days thereafter by registered mail by plaintiff or plaintiff’s attorney to the defendant at the defendant’s last known principal place of business, and the defendant’s receipt, or receipt issued by the post office with which the letter is registered, showing the name of the sender of the letter and the name and address of the person to whom the letter is addressed, and the affidavit of the plaintiff or plaintiff’s attorney showing a compliance herewith are filed with the clerk of the court in which the action is pending on or before the date the defendant is required to appear, or within such further time as the court may allow.
(2) Service of process in any such action, suit, or proceeding shall, in addition to the manner provided in subsection (1), be valid if served upon any person within this state who, in this state on behalf of the unauthorized insurer or person representing or aiding such insurer, is:
(a) Soliciting insurance;
(b) Making, issuing, or delivering any contract of insurance; or
(c) Collecting or receiving any premium, membership fee, assessment, or other consideration for insurance;
and a copy of such process is sent within 10 days thereafter by registered mail by the plaintiff or plaintiff’s attorney to the defendant at the last known principal place of business of the defendant, and the defendant’s receipt, or the receipt issued by the post office with which the letter is registered, showing the name of the sender of the letter and the name and address of the person to whom the letter is addressed, and the affidavit of the plaintiff or plaintiff’s attorney showing a compliance herewith are filed with the clerk of the court in which such action is pending on or before the date the defendant is required to appear, or within such further time as the court may allow.
(3) No plaintiff shall be entitled to a judgment by default or a decree pro confesso under this section until the expiration of 30 days from date of the filing of the affidavit of compliance.
(4) Nothing in this section shall limit or abridge the right to serve any process, notice, or demand upon any insurer or person representing or aiding such insurer in any other manner now or hereafter permitted by law.
History.—s. 348, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 156, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 296, ch. 97-102; s. 1011, ch. 2003-261.
626.908 Defense of action by unauthorized insurer or person representing or aiding such insurer; damages and attorney fee.—
(1) Before an unauthorized insurer or person representing or aiding such insurer files or causes to be filed any pleading in any action or proceeding instituted against it under s. 626.906, s. 626.907, or s. 626.909 or a suit instituted by the office or the department enforcing agency action against unauthorized insurers under s. 120.69, an unauthorized insurer or person representing or aiding such insurer shall:
(a) Procure a certificate of authority to transact insurance in this state, or
(b) Deposit with the clerk of the court in which such action or proceeding is pending cash or securities or file with such clerk a bond with good and sufficient sureties, to be approved by the court, in an amount to be fixed by the court sufficient to secure the payment of any final judgment which may be rendered in such action. The court may in its discretion make an order dispensing with such deposit or bond where the insurer makes a showing satisfactory to the court that it maintains in a state of the United States funds or securities, in trust or otherwise, sufficient and available to satisfy any final judgment which may be entered in such action or proceeding, and that the insurer or person representing or aiding such insurer will pay any final judgment entered therein without requiring suit to be brought on such judgment in the state where such funds or securities are located, and that if, nevertheless, such suit is brought on such final judgment the insurer or person representing or aiding such insurer shall waive all defenses thereto.
(c) Any proof, evidence, or testimony in support of such motion shall be taken in the jurisdiction of the court in which the action or proceeding is pending.
(d) If the unauthorized insurer or person representing or aiding such insurer seeks to take discovery or de bene esse depositions of witnesses beyond the jurisdiction of the court in which the action is pending, upon seasonable application by the plaintiff, the court by appropriate order shall require the unauthorized insurer or person representing or aiding such insurer, before such depositions are taken, to make similar deposit as described in paragraph (b), in sufficient amount to pay the reasonable expenses of the plaintiff and his or her attorney in attending the taking of such depositions, including reasonable attorney’s fees to be fixed by the court.
(2) The court in any action or proceeding in which service is made in the manner provided in s. 626.907 may, in its discretion, order such postponement as may be necessary to afford the defendant reasonable opportunity to comply with the provisions of subsection (1) and to defend such action.
(3) Nothing in subsection (1) is to be construed to prevent an unauthorized insurer or person representing or aiding such insurer from filing, within 30 days after service, a motion to quash or to set aside the service of any process made in the manner provided in s. 626.907 hereof on the ground either:
(a) That such unauthorized insurer or person representing or aiding such insurer has not done any of the acts enumerated in s. 626.906; or
(b) That the person on whom service was made pursuant to s. 626.907(2) was not doing any of the acts therein enumerated.
History.—s. 349, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 157, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 297, ch. 97-102; s. 3, ch. 2005-144.
626.909 Jurisdiction of office and department; service of process on Secretary of State.—
(1) The Legislature hereby declares that it is a subject of concern that the purpose of the Unauthorized Insurers Process Law as expressed in s. 626.905 may be denied by the possibility that the right of service of process provided for in that law may be restricted only to those actions, suits, or proceedings brought by insureds or beneficiaries. It therefore declares that it is the intent of s. 626.905 that it is the obligation and duty of the state to protect its residents and also proceed under this law through the office or department in the courts of this state. It further declares that it is also the intent of the Legislature to subject unauthorized insurers and persons representing or aiding such insurers to the jurisdiction of the office or department in proceedings, examinations, or hearings before it as provided for in this code.
(2) In addition to the procedure for service of process on unauthorized insurers or persons representing or aiding such insurers contained in ss. 626.906 and 626.907, the office or department shall have the right to bring any action, suit, or proceeding in the name of the state or conduct any proceeding, examination, or hearing provided for in this code against any unauthorized insurer or person representing or aiding such insurer for violation of any lawful order of the office or department or any provision of this code, specifically including but not limited to the regulation of trade practices provided for in part IX of this chapter, if the insurer or person representing or aiding such insurer transacts insurance in this state as defined in ss. 624.10 and 626.906 and the insurer does not transact such business under a subsisting certificate of authority as required by s. 624.401. In the event the transaction of business is done by mail, the venue of the act is at the point where the matter transmitted by mail is delivered and takes effect.
(3) In addition to the right of action, suit, or proceeding authorized by subsection (2), the office or department shall have the right to bring a civil action in the name of the state, as parens patriae on behalf of any insured, beneficiary of any insured, claimant or dependent, or any other person or class of persons injured as a result of the transaction of any insurance business as defined in s. 626.906 by any unauthorized insurer, as defined in s. 624.09 who is also an ineligible insurer as set forth in ss. 626.917 and 626.918, or any person who represents or aids any unauthorized insurer, in violation of s. 626.901, to recover actual damages on behalf of individuals who were residents at the time the transaction occurred and the cost of such suit, including a reasonable attorney’s fee. The court shall exclude from the amount of monetary relief awarded in such action any amount of monetary relief which duplicates amounts which have been awarded for the same injury.
(4) Transaction of business in this state, as so defined, by any unauthorized insurer or person representing or aiding such insurer shall be deemed consent by the insurer or person representing or aiding such insurer to the jurisdiction of the office or department in proceedings, examinations, and hearings before it as provided for in this code and shall constitute an irrevocable appointment by the insurer or person representing or aiding such insurer of the Secretary of State and his or her successor or successors in office as its true and lawful attorney upon whom may be served all lawful process in any action, suit, or proceeding in any court by the office or department or by the state and upon whom may be served all notices and orders of the office or department arising out of any such transaction of business; and such transaction of business shall constitute the agreement of the insurer or person representing or aiding such insurer that any such process against it or any such notice or order which is so served shall be of the same legal force and validity as if served personally within this state on the insurer or person representing or aiding such insurer. Service of process shall be in accordance with and in the same manner as now provided for service of process upon nonresidents under the provision of s. 48.161, and service of process shall also be valid if made as provided in s. 626.907(2).
(5) No plaintiff shall be entitled to a judgment by default or a decree pro confesso under this section until the expiration of 30 days after date of the filing of the affidavit of compliance.
(6) Nothing in this section shall limit or abridge the right to serve any process, notice, orders, or demand upon the insurer or person representing or aiding such insurer in any other manner now or hereafter permitted by law.
(7) Nothing in this section shall apply as to surplus lines insurance when written pursuant to the Surplus Lines Law, ss. 626.913-626.937, or as to transactions as to which a certificate of authority is not required of the insurer, as stated in s. 624.402.
History.—s. 1, ch. 67-118; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 295, 318, 807, ch. 82-243; s. 25, ch. 87-226; ss. 158, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 298, ch. 97-102; s. 51, ch. 2001-63; s. 1012, ch. 2003-261.
626.910 Penalty for violation by unauthorized insurers and persons representing or aiding such insurers.—Any unauthorized insurer or person representing or aiding such insurer transacting insurance in this state and subject to service of process as referred to in s. 626.909 shall forfeit and pay to the state a civil penalty of not more than $1,000 for each nonwillful violation, or not more than $10,000 for each willful violation, of any lawful order of the office or department or any provision of this code.
History.—s. 2, ch. 67-118; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 296, 318, 807, ch. 82-243; ss. 159, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1013, ch. 2003-261.
626.911 Attorney’s fee.—In any action against an unauthorized foreign insurer, alien insurer, or person representing or aiding such an insurer, upon a contract of insurance issued or delivered in this state to a resident thereof or to a corporation authorized to do business therein, if the insurer or person representing or aiding such insurer has failed for 30 days after demand prior to the commencement of the action to make payment in accordance with the terms of the contract, the trial judge shall allow to the plaintiff a reasonable attorney’s fee or compensation and include such fee or compensation in any judgment that may be rendered in such action.
History.—s. 350, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 160, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.912 Exemptions from ss. 626.904-626.911.—The provisions of ss. 626.904-626.911 do not apply to any action, suit, or proceeding against any unauthorized foreign insurer, alien insurer, or person representing or aiding such an insurer arising out of any contract of insurance:
(1) Covering reinsurance, wet marine and transportation, commercial aircraft, or railway insurance risks;
(2) Against legal liability arising out of the ownership, operation, or maintenance of any property having a permanent situs outside this state;
(3) Against loss of or damage to any property having a permanent situs outside this state; or
(4) Issued under and in accordance with the Surplus Lines Law, when such insurer or person representing or aiding such insurer enters a general appearance or when such contract of insurance contains a provision designating the Chief Financial Officer or designating a Florida resident agent to be the true and lawful attorney of such unauthorized insurer or person representing or aiding such insurer upon whom may be served all lawful process in any action, suit, or proceeding instituted by or on behalf of an insured or person representing or aiding such insurer or beneficiary arising out of any such contract of insurance; and service of process effected on such Chief Financial Officer or such resident agent shall be deemed to confer complete jurisdiction over such unauthorized insurer or person representing or aiding such insurer in such action.
History.—s. 351, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 161, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 299, ch. 97-102; s. 1014, ch. 2003-261.
626.913 Surplus Lines Law; short title; purposes.—
(1) Sections 626.913-626.937 constitute and may be referred to as the “Surplus Lines Law.”
(2) It is declared that the purposes of the Surplus Lines Law are to provide orderly access for the insuring public of this state to insurers not authorized to transact insurance in this state, through only qualified, licensed, and supervised surplus lines agents resident in this state, for insurance coverages and to the extent thereof not procurable from authorized insurers; to protect such authorized insurers, who under the laws of this state must meet certain standards as to policy forms and rates, from unwarranted competition by unauthorized insurers who, in the absence of this law, would not be subject to similar requirements; and for other purposes as set forth in this Surplus Lines Law.
(3) This section, and this Surplus Lines Law, do not apply as to insurance coverages which are subject to s. 626.938.
(4) Except as may be specifically stated to apply to surplus lines insurers, the provisions of chapter 627 do not apply to surplus lines insurance authorized under ss. 626.913-626.937, the Surplus Lines Law.
History.—s. 352, ch. 59-205; s. 2, ch. 81-318; ss. 297, 318, 807, ch. 82-243; s. 42, ch. 82-386; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1, ch. 2009-166.
626.914 Definitions.—As used in this Surplus Lines Law, the term:
(1) “Surplus lines agent” means an individual licensed as provided in this part to handle the placement of insurance coverages with unauthorized insurers and to place such coverages with authorized insurers as to which the licensee is not licensed as an agent.
(2) “Eligible surplus lines insurer” means an unauthorized insurer which has been made eligible by the office to issue insurance coverage under this Surplus Lines Law.
(3) “To export” means to place, in an unauthorized insurer under this Surplus Lines Law, insurance covering a subject of insurance resident, located, or to be performed in this state.
(4) “Diligent effort” means seeking coverage from and having been rejected by at least three authorized insurers currently writing this type of coverage and documenting these rejections. However, if the residential structure has a dwelling replacement cost of $1 million or more, the term means seeking coverage from and having been rejected by at least one authorized insurer currently writing this type of coverage and documenting this rejection.
History.—s. 353, ch. 59-205; s. 2, ch. 81-318; ss. 298, 318, 807, ch. 82-243; ss. 162, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1015, ch. 2003-261; s. 5, ch. 2007-90.
626.915 Surplus lines insurance authorized.—If certain insurance coverages of subjects resident, located, or to be performed in this state cannot be procured from authorized insurers, such coverages, hereinafter designated “surplus lines,” may be procured from unauthorized insurers, subject to the following conditions:
(1) The insurance must be eligible for export under s. 626.916 or s. 626.917;
(2) The insurer must be an eligible surplus lines insurer under s. 626.917 or s. 626.918;
(3) The insurance must be so placed through a licensed Florida surplus lines agent; and
(4) The other applicable provisions of this Surplus Lines Law must be met.
History.—s. 354, ch. 59-205; s. 2, ch. 81-318; ss. 299, 318, 807, ch. 82-243; ss. 163, 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.916 Eligibility for export.—
(1) No insurance coverage shall be eligible for export unless it meets all of the following conditions:
(a) The full amount of insurance required must not be procurable, after a diligent effort has been made by the producing agent to do so, from among the insurers authorized to transact and actually writing that kind and class of insurance in this state, and the amount of insurance exported shall be only the excess over the amount so procurable from authorized insurers. Surplus lines agents must verify that a diligent effort has been made by requiring a properly documented statement of diligent effort from the retail or producing agent. However, to be in compliance with the diligent effort requirement, the surplus lines agent’s reliance must be reasonable under the particular circumstances surrounding the export of that particular risk. Reasonableness shall be assessed by taking into account factors which include, but are not limited to, a regularly conducted program of verification of the information provided by the retail or producing agent. Declinations must be documented on a risk-by-risk basis. If it is not possible to obtain the full amount of insurance required by layering the risk, it is permissible to export the full amount.
(b) The premium rate at which the coverage is exported shall not be lower than that rate applicable, if any, in actual and current use by a majority of the authorized insurers for the same coverage on a similar risk.
(c) The policy or contract form under which the insurance is exported shall not be more favorable to the insured as to the coverage or rate than under similar contracts on file and in actual current use in this state by the majority of authorized insurers actually writing similar coverages on similar risks; except that a coverage may be exported under a unique form of policy designed for use with respect to a particular subject of insurance if a copy of such form is filed with the office by the surplus lines agent desiring to use the same and is subject to the disapproval of the office within 10 days of filing such form exclusive of Saturdays, Sundays, and legal holidays if it finds that the use of such special form is not reasonably necessary for the principal purposes of the coverage or that its use would be contrary to the purposes of this Surplus Lines Law with respect to the reasonable protection of authorized insurers from unwarranted competition by unauthorized insurers.
(d) Except as to extended coverage in connection with fire insurance policies and except as to windstorm insurance, the policy or contract under which the insurance is exported shall not provide for deductible amounts, in determining the existence or extent of the insurer’s liability, other than those available under similar policies or contracts in actual and current use by one or more authorized insurers.
(e) For personal residential property risks, the retail or producing agent must advise the insured in writing that coverage may be available and may be less expensive from Citizens Property Insurance Corporation. The notice must include other information that states that assessments by Citizens Property Insurance Corporation are higher and the coverage provided by Citizens Property Insurance Corporation may be less than the property’s existing coverage. If the notice is signed by the insured, it is presumed that the insured has been informed and knows that policies from Citizens Property Insurance Corporation may be less expensive, may provide less coverage, and will be accompanied by higher assessments.
(2) The commission may by rule declare eligible for export generally, and notwithstanding the provisions of paragraphs (a), (b), (c), and (d) of subsection (1), any class or classes of insurance coverage or risk for which it finds, after a hearing, that there is no reasonable or adequate market among authorized insurers. Any such rules shall continue in effect during the existence of the conditions upon which predicated, but subject to termination by the commission.
(3)(a) Subsection (1) does not apply to wet marine and transportation or aviation risks which are subject to s. 626.917.
(b) Paragraphs (1)(a)-(d) do not apply to classes of insurance which are subject to s. 627.062(3)(d)1. These classes may be exportable under the following conditions:
1. The insurance must be placed only by or through a surplus lines agent licensed in this state;
2. The insurer must be made eligible under s. 626.918; and
3. The insured must sign a disclosure that substantially provides the following: “You are agreeing to place coverage in the surplus lines market. Superior coverage may be available in the admitted market and at a lesser cost. Persons insured by surplus lines carriers are not protected under the Florida Insurance Guaranty Act with respect to any right of recovery for the obligation of an insolvent unlicensed insurer.” If the notice is signed by the insured, the insured is presumed to have been informed and to know that other coverage may be available, and, with respect to the diligent-effort requirement under subsection (1), there is no liability on the part of, and no cause of action arises against, the retail agent presenting the form.
(4) A reasonable per-policy fee, not to exceed $35, may be charged by the filing surplus lines agent for each policy certified for export.
History.—s. 355, ch. 59-205; s. 1, ch. 63-86; s. 1, ch. 67-380; ss. 13, 35, ch. 69-106; s. 91, ch. 79-40; s. 2, ch. 81-318; ss. 300, 318, 807, ch. 82-243; ss. 164, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 29, ch. 92-146; s. 1, ch. 2001-213; s. 1016, ch. 2003-261; s. 6, ch. 2007-90; s. 17, ch. 2011-174.
626.917 Eligibility for export; wet marine and transportation, aviation risks.—
(1) Insurance coverage of wet marine and transportation risks, as defined in this code in s. 624.607(2), or aviation risks, including airport and products liability incidental thereto and hangarkeeper’s liability, may be exported under the following conditions:
(a) The insurance must be placed only by or through a licensed Florida surplus lines agent; and
(b) The insurer must be one made eligible by the office specifically for such coverages, based upon information furnished by the insurer and indicating that the insurer is well able to meet its financial obligations.
(2) This section does not apply as to boats or aircraft used solely for personal pleasure, family use, or the transportation of executives, employees, and guests of the insured.
History.—s. 356, ch. 59-205; s. 2, ch. 63-86; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 301, 318, 807, ch. 82-243; ss. 165, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1017, ch. 2003-261.
626.918 Eligible surplus lines insurers.—
(1) A surplus lines agent may not place any coverage with any unauthorized insurer which is not then an eligible surplus lines insurer, except as permitted under subsections (5) and (6).
(2) An unauthorized insurer may not be or become an eligible surplus lines insurer unless made eligible by the office in accordance with the following conditions:
(a) Eligibility of the insurer must be requested in writing by the Florida Surplus Lines Service Office.
(b) The insurer must be currently an authorized insurer in the state or country of its domicile as to the kind or kinds of insurance proposed to be so placed and must have been such an insurer for not less than the 3 years next preceding or must be the wholly owned subsidiary of such authorized insurer or must be the wholly owned subsidiary of an already eligible surplus lines insurer as to the kind or kinds of insurance proposed for a period of not less than the 3 years next preceding. However, the office may waive the 3-year requirement if the insurer provides a product or service not readily available to the consumers of this state or has operated successfully for a period of at least 1 year next preceding and has capital and surplus of not less than $25 million.
(c) Before granting eligibility, the requesting surplus lines agent or the insurer shall furnish the office with a duly authenticated copy of its current annual financial statement in the English language and with all monetary values therein expressed in United States dollars, at an exchange rate (in the case of statements originally made in the currencies of other countries) then-current and shown in the statement, and with such additional information relative to the insurer as the office may request.
(d)1.a. The insurer must have and maintain surplus as to policyholders of not less than $15 million; in addition, an alien insurer must also have and maintain in the United States a trust fund for the protection of all its policyholders in the United States under terms deemed by the office to be reasonably adequate, in an amount not less than $5.4 million. Any such surplus as to policyholders or trust fund shall be represented by investments consisting of eligible investments for like funds of like domestic insurers under part II of chapter 625 provided, however, that in the case of an alien insurance company, any such surplus as to policyholders may be represented by investments permitted by the domestic regulator of such alien insurance company if such investments are substantially similar in terms of quality, liquidity, and security to eligible investments for like funds of like domestic insurers under part II of chapter 625. Clean, irrevocable, unconditional, and evergreen letters of credit issued or confirmed by a qualified United States financial institution, as defined in subparagraph 2., may be used to fund the trust.
b. For those surplus lines insurers that were eligible on January 1, 1994, and that maintained their eligibility thereafter, the required surplus as to policyholders shall be:
(I) On December 31, 1994, and until December 30, 1995, $2.5 million.
(II) On December 31, 1995, and until December 30, 1996, $3.5 million.
(III) On December 31, 1996, and until December 30, 1997, $4.5 million.
(IV) On December 31, 1997, and until December 30, 1998, $5.5 million.
(V) On December 31, 1998, and until December 30, 1999, $6.5 million.
(VI) On December 31, 1999, and until December 30, 2000, $8 million.
(VII) On December 31, 2000, and until December 30, 2001, $9.5 million.
(VIII) On December 31, 2001, and until December 30, 2002, $11 million.
(IX) On December 31, 2002, and until December 30, 2003, $13 million.
(X) On December 31, 2003, and thereafter, $15 million.
c. The capital and surplus requirements as set forth in sub-subparagraph b. do not apply in the case of an insurance exchange created by the laws of individual states, where the exchange maintains capital and surplus pursuant to the requirements of that state, or maintains capital and surplus in an amount not less than $50 million in the aggregate. For an insurance exchange which maintains funds in the amount of at least $12 million for the protection of all insurance exchange policyholders, each individual syndicate shall maintain minimum capital and surplus in an amount not less than $3 million. If the insurance exchange does not maintain funds in the amount of at least $12 million for the protection of all insurance exchange policyholders, each individual syndicate shall meet the minimum capital and surplus requirements set forth in sub-subparagraph b.
d. A surplus lines insurer which is a member of an insurance holding company that includes a member which is a Florida domestic insurer as set forth in its holding company registration statement, as set forth in s. 628.801 and rules adopted thereunder, may elect to maintain surplus as to policyholders in an amount equal to the requirements of s. 624.408, subject to the requirement that the surplus lines insurer shall at all times be in compliance with the requirements of chapter 625.
The election shall be submitted to the office and shall be effective upon the office’s being satisfied that the requirements of sub-subparagraph d. have been met. The initial date of election shall be the date of office approval. The election approval application shall be on a form adopted by commission rule. The office may approve an election form submitted pursuant to sub-subparagraph d. only if it was on file with the former Department of Insurance before February 28, 1998.
2. For purposes of letters of credit under subparagraph 1., the term “qualified United States financial institution” means an institution that:
a. Is organized or, in the case of a United States office of a foreign banking organization, is licensed under the laws of the United States or any state.
b. Is regulated, supervised, and examined by authorities of the United States or any state having regulatory authority over banks and trust companies.
c. Has been determined by the office or the Securities Valuation Office of the National Association of Insurance Commissioners to meet such standards of financial condition and standing as are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit are acceptable to the office.
(e) The insurer must be of good reputation as to the providing of service to its policyholders and the payment of losses and claims.
(f) The insurer must be eligible, as for authority to transact insurance in this state, under s. 624.404(3).
(g) This subsection does not apply as to unauthorized insurers made eligible under s. 626.917 as to wet marine and aviation risks.
(3) The office shall from time to time publish a list of all currently eligible surplus lines insurers and shall mail a copy thereof to each licensed surplus lines agent at his or her office of record with the office.
(4) This section shall not be deemed to cast upon the office any duty or responsibility to determine the actual financial condition or claims practices of any unauthorized insurer; and the status of eligibility, if granted by the office, shall indicate only that the insurer appears to be sound financially and to have satisfactory claims practices and that the office has no credible evidence to the contrary.
(5) When it appears that any particular insurance risk which is eligible for export, but on which insurance coverage, in whole or in part, is not procurable from the eligible surplus lines insurers, after a search of eligible surplus lines insurers, then the surplus lines agent may file a supplemental signed statement setting forth such facts and advising the office that such part of the risk as shall be unprocurable, as aforesaid, is being placed with named unauthorized insurers, in the amounts and percentages set forth in the statement. Such named unauthorized insurer shall, however, before accepting any risk in this state, deposit with the department cash or securities acceptable to the office and department of the market value of $50,000 for each individual risk, contract, or certificate, which deposit shall be held by the department for the benefit of Florida policyholders only; and the surplus lines agent shall procure from such unauthorized insurer and file with the office a certified copy of its statement of condition as of the close of the last calendar year. If such statement reveals, including both capital and surplus, net assets of at least that amount required for licensure of a domestic insurer, then the surplus lines agent may proceed to consummate such contract of insurance. Whenever any insurance risk, or any part thereof, is placed with an unauthorized insurer, as provided herein, the policy, binder, or cover note shall contain a statement signed by the insured and the agent with the following notation: “The insured is aware that certain insurers participating in this risk have not been approved to transact business in Florida nor have they been declared eligible as surplus lines insurers by the Office of Insurance Regulation of Florida. The placing of such insurance by a duly licensed surplus lines agent in Florida shall not be construed as approval of such insurer by the Office of Insurance Regulation of Florida. Consequently, the insured is aware that the insured has severely limited the assistance available under the insurance laws of Florida. The insured is further aware that he or she may be charged a reasonable per policy fee, as provided in s. 626.916(4), Florida Statutes, for each policy certified for export.” All other provisions of this code shall apply to such placement the same as if such risks were placed with an eligible surplus lines insurer.
(6) When any particular insurance risk subject to subsection (5) is eligible for placement with an unauthorized insurer and not more than 12.5 percent of the risk is so subject, the office may, at its discretion, permit the agent to obtain from the insured a signed statement as indicated in subsection (5). All other provisions of this code apply to such placement the same as if such risks were placed with an eligible surplus lines insurer.
History.—s. 357, ch. 59-205; s. 1, ch. 61-105; s. 3, ch. 63-86; s. 1, ch. 63-209; ss. 13, 35, ch. 69-106; s. 2, ch. 71-18; s. 2, ch. 81-318; ss. 302, 318, 807, ch. 82-243; s. 2, ch. 88-104; s. 31, ch. 88-166; ss. 166, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 30, ch. 92-146; s. 12, ch. 93-410; s. 300, ch. 97-102; ss. 2, 7, ch. 97-196; s. 68, ch. 98-199; s. 2, ch. 2001-213; s. 1018, ch. 2003-261; s. 10, ch. 2006-12.
626.9181 Levy upon deposit.—No judgment creditor or other claimant of a surplus lines insurer shall have the right to levy upon any of the assets or securities held in this state as a deposit under s. 626.918.
History.—s. 34, ch. 85-321; s. 207, ch. 90-363; s. 4, ch. 91-429.
626.919 Withdrawal of eligibility; surplus lines insurer.—
(1) If at any time the office has reason to believe that any unauthorized insurer then on the list of eligible surplus lines insurers is insolvent or in unsound financial condition, or does not make reasonable prompt payment of just losses and claims in this state, or that it is no longer eligible under the conditions therefor provided in s. 626.918, it shall withdraw the eligibility of the insurer to insure surplus lines risks in this state.
(2) If the office finds that an insurer currently eligible as a surplus lines insurer has willfully violated the laws of this state or a rule of the commission, it may, in its discretion, withdraw the eligibility of the insurer to insure surplus lines risks in this state.
(3) The office shall promptly mail notice of all such withdrawals of eligibility to each surplus lines agent at his or her address of record with the department.
History.—s. 358, ch. 59-205; ss. 13, 35, ch. 69-106; s. 21, ch. 78-95; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 167, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 301, ch. 97-102; s. 1019, ch. 2003-261.
626.9201 Notice of cancellation or nonrenewal.—
(1) An insurer issuing a policy providing coverage for property, casualty, surety, or marine insurance must give the first named insured at least 45 days’ advance written notice of nonrenewal. If the policy is not to be renewed, the written notice shall state the reasons as to why the policy is not to be renewed. This subsection does not apply:
(a) If the insurer has manifested its willingness to renew, and the offer is not rescinded prior to expiration of the policy; or
(b) If a notice of cancellation for nonpayment of premium is provided under subsection (2).
(2) An insurer issuing a policy providing coverage for property, casualty, surety, or marine insurance must give the named insured written notice of cancellation or termination other than nonrenewal at least 45 days before the effective date of the cancellation or termination, including in the written notice the reasons for the cancellation or termination, except that:
(a) If cancellation is for nonpayment of premium, at least 10 days’ written notice of cancellation accompanied by the reason for cancellation must be given. As used in this paragraph, the term “nonpayment of premium” means the failure of the named insured to discharge when due any of his or her obligations in connection with the payment of premiums on a policy or an installment of such a premium, whether the premium or installment is payable directly to the insurer or its agent or indirectly under any plan for financing premiums or extension of credit or the failure of the named insured to maintain membership in an organization if such membership is a condition precedent to insurance coverage. The term also includes the failure of a financial institution to honor the check of an applicant for insurance which was delivered to a licensed agent for payment of a premium, even if the agent previously delivered or transferred the premium to the insurer. If a correctly dishonored check represents payment of the initial premium, the contract and all contractual obligations are void ab initio unless the nonpayment is cured within the earlier of 5 days after actual notice by certified mail is received by the applicant or 15 days after notice is sent to the applicant by certified mail or registered mail, and, if the contract is void, any premium received by the insurer from a third party shall be refunded to that party in full; and
(b) If cancellation or termination occurs during the first 90 days during which the insurance is in force and if the insurance is canceled or terminated for reasons other than nonpayment, at least 20 days’ written notice of cancellation or termination accompanied by the reason for cancellation or termination must be given, except if there has been a material misstatement or misrepresentation or failure to comply with the underwriting requirements established by the insurer.
(3) If an insurer fails to provide the written notice as required under this section, the coverage provided to the named insured remains in effect until 45 days after the notice is given or until the effective date of replacement coverage obtained by the named insured, whichever occurs first. The premium for the coverage remains the same during any such extension period.
History.—ss. 168, 207, ch. 90-363; s. 4, ch. 91-429; s. 7, ch. 2007-90; s. 9, ch. 2012-151.
626.921 Florida Surplus Lines Service Office.—
(1) There is hereby created a nonprofit association to be known as the Florida Surplus Lines Service Office. The Legislature hereby finds and declares that the establishment of a surplus lines self-regulating organization is necessary to establish a system that will permit better access by consumers to approved unauthorized insurers. Accordingly, the Legislature declares that this section shall be liberally construed and applied to promote its underlying purposes, which will protect consumers seeking insurance in this state, permit surplus lines insurance to be placed with approved surplus lines insurers, establish a self-regulating organization which will promote and permit orderly access to surplus lines insurance in this state, enhance the number and types of insurance products available to consumers in this state, provide a source of advice and counsel for the benefit of consumers, surplus lines agents, insurers, and government agencies concerning the operation of the surplus lines insurance market, and protect the revenues of this state.
(2) All surplus lines agents shall, as a condition of holding a license as a surplus lines agent in this state, be deemed to be members of this association and shall report to and file with the service office a copy of or information on each surplus lines insurance policy or document as provided in the plan of operation adopted under subsection (5). The service office shall immediately report the particulars of any unfiled policy to the department for enforcement of compliance with the Florida Surplus Lines Law.
(3) The association shall perform its functions under a plan of operation adopted under subsection (5). It shall exercise its powers through a board of governors established under subsection (4). The association shall be regulated by the office and is subject to the applicable provisions of this code and the rules of the commission and, with respect to surplus lines agents, rules of the department. The service office shall conduct the following activities provided in the plan of operation adopted under subsection (5):
(a) Receive, record, and review all surplus lines insurance policies or documents.
(b) Maintain records of the surplus lines policies reported to the service office and prepare monthly reports for the office in such form as the commission may prescribe.
(c) Prepare and deliver to each surplus lines agent quarterly reports of each surplus lines agent’s business in such form as the commission may prescribe, and collect and remit to the department the surplus lines tax as provided for in s. 626.932.
(d) Perform a reconciliation of the policies written in the nonadmitted market, as provided by nonadmitted insurers, with the policies reported to the service office by the surplus lines agents, and prepare and deliver to the office a report on the results of the reconciliation in such form as the commission may prescribe.
(e) Submit to the office for review and approval an annual budget for the operation of the service office.
(f) Collect from each surplus lines agent a service fee of up to 0.3 percent, as determined by the office, of the total gross premium of each surplus lines policy or document reported under this section, for the cost of operation of the service office. The service fee shall be paid by the insured.
(g) Employ and retain such personnel as are necessary to carry out the duties of the service office.
(h) Borrow money, as necessary, to effect the purposes of the service office.
(i) Enter into contracts, as necessary, to effect the purposes of the service office.
(j) Perform such other acts as will facilitate and encourage compliance with the surplus lines law of this state and rules adopted thereunder.
(k) Provide such other services as are incidental or related to the purposes of the service office.
(4) The association shall operate under the supervision of a board of governors consisting of:
(a) Five individuals appointed by the department from the regular membership of the Florida Surplus Lines Association.
(b) Two individuals appointed by the department, one from each of the two largest domestic agents’ associations, each of whom shall be licensed surplus lines agents.
(c) The Insurance Consumer Advocate.
(d) One individual appointed by the department, who shall be a risk manager for a large domestic commercial enterprise.
Each board member shall be appointed to serve beginning on the date designated by the plan of operation and shall serve at the pleasure of the department for a 3-year term, such term initially to be staggered by the plan of operation so that three appointments expire in 1 year, three appointments expire in 2 years, and three appointments expire in 3 years. Members may be reappointed for subsequent terms. The board of governors shall elect such officers as may be provided in the plan of operation.
(5)(a) The association shall submit to the office a plan of operation, and any amendments thereto, to provide operating procedures for the administration of the service office. The plan of operation and any amendments thereto shall become effective upon approval by order of the office. The association shall submit to the department an agent’s manual, and any amendments thereto, which shall provide administrative procedures that surplus lines insurance agents must follow with respect to their duties to the service office. The manual shall be prepared in cooperation with the department, and any changes, updates, or amendments shall be submitted to the department before distribution. The manual shall be approved by order of the department.
(b) If the association fails to submit a suitable plan of operation within 180 days following the effective date of this act, or if at any time thereafter the association fails to submit suitable amendments to the plan of operation, the office shall, after notice and hearing, adopt by order a plan of operation, or amendments to a plan of operation, and the commission shall adopt such rules as are necessary or advisable to effectuate the provisions of this section. Such rules shall continue in force until modified by the commission or superseded by a plan of operation submitted by the association and approved by order of the office.
(c) All surplus lines agents licensed in this state must comply with the plan of operation and the agent’s manual.
(6) The office shall, at such times deemed necessary, make or cause to be made an examination of the association. The costs of any such examination shall be paid by the association. During the course of such examination, the governors, officers, agents, employees, and members of the association may be examined under oath regarding the operation of the service office and shall make available all books, records, accounts, documents, and agreements pertaining thereto.
(7) There shall be no liability on the part of, and no cause of action of any nature shall arise against, any member or its agents or employees, agents or employees of the association, the commission, the office, members of the board of governors of the association, or the department or its representatives, for any action taken by them in the performance of their duties or responsibilities under this subsection. Such immunity does not apply to actions for breach of any contract or agreement pertaining to insurance, or any willful tort.
(8)(a) Information furnished to the department under s. 626.923 or contained in records subject to examination by the department under s. 626.930 is confidential and exempt from s. 119.07(1) and s. 24(a), Art. I of the State Constitution if disclosure would reveal information specific to a particular policy or policyholder. The exemption does not apply to any proceeding instituted by the department or office against an agent or insurer.
(b) Information furnished to the Florida Surplus Lines Service Office under the Surplus Lines Law is confidential and exempt from s. 119.07(1) and s. 24(a), Art. I of the State Constitution if disclosure would reveal information specific to a particular policy or policyholder. The Florida Surplus Lines Service Office may provide such information to the department in the furtherance of its duties and responsibilities. The exemption does not apply to any proceeding instituted by the department or office against an agent or insurer.
History.—s. 360, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 304, 318, 807, ch. 82-243; ss. 169, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 9, ch. 93-80; s. 377, ch. 96-406; s. 3, ch. 97-196; s. 1, ch. 2001-181; s. 3, ch. 2001-213; s. 1020, ch. 2003-261; s. 1, ch. 2006-188; s. 8, ch. 2007-199.
626.922 Evidence of the insurance; changes; penalty.—
(1) Upon placing a surplus lines coverage, the surplus lines agent shall promptly issue and deliver to the insured evidence of the insurance consisting either of the policy as issued by the insurer or, if such policy is not then available, a certificate, cover note, or other confirmation of insurance. Such document shall be executed or countersigned by the surplus lines agent and shall show the description and location of the subject of the insurance; coverage, conditions, and term of the insurance; the premium and rate charged and taxes collected from the insured; and the name and address of the insured and insurer. If the direct risk is assumed by more than one insurer, the document shall state the name and address and proportion of the entire direct risk assumed by each insurer. A surplus lines agent may not delegate the duty to issue any such document to producing general lines agents without prior written authority from the surplus lines insurer. A general lines agent may issue any such document only if the agent has prior written authority from the surplus lines agent. The surplus lines agent must maintain copies of the authorization from the surplus lines insurer and the delegation to the producing general lines agent. The producing agent must maintain copies of the written delegation from the surplus lines agent and copies of any evidence of coverage or certificate of insurance which the producing agent issues or delivers. Any evidence of coverage issued by a producing agent pursuant to this section must include the name and address of the authorizing surplus lines agent.
(2) No surplus lines agent shall issue any such document, or purport to insure or represent that insurance will be or has been granted by any unauthorized insurer, unless he or she has prior written authority from the insurer for the insurance, or has received information from the insurer in the regular course of business that such insurance has been granted, or an insurance policy providing the insurance actually has been issued by the insurer and delivered to the insured.
(3) If after the issuance and delivery of any such document there is any change as to the identity of the insurers, or the proportion of the direct risk assumed by the insurer as stated in the original certificate, cover note, or confirmation, or in any other material respect as to the insurance coverage evidenced by such a document, the surplus lines agent shall promptly issue and deliver to the insured a substitute certificate, cover note, or confirmation, or an endorsement for the original such document, accurately showing the current status of the coverage and the insurers responsible thereunder. No such change shall result in a coverage or insurance contract which would be in violation of this Surplus Lines Law if originally issued on such basis.
(4) A copy of the policy or cover note or confirmation of insurance shall be delivered to the insured within 60 days after the effectuation of coverage.
(5) Any surplus lines agent who knowingly or negligently issues a false certificate, cover note, or confirmation of insurance, or false endorsement therefor, or who fails promptly to notify the insured of any material change with respect to such insurance by delivery to the insured of a substitute certificate, cover note, or confirmation, or endorsement as provided in subsection (3), shall, upon conviction, be subject to the penalties provided by s. 624.15 or to any greater applicable penalty otherwise provided by law.
History.—s. 361, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 170, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 302, ch. 97-102; s. 69, ch. 98-199.
626.923 Filing copy of policy or certificate.—A surplus lines agent shall, within 30 days after the date of a request by the department or the Florida Surplus Lines Service Office, furnish an exact copy of any and all requested policies, including applications, certificates, cover notes, or other forms of confirmation of insurance coverage or any substitutions thereof or endorsements thereto. The department or the Florida Surplus Lines Service Office may also request and the agent shall furnish, within 30 days after the date of the request, the agent’s memorandum as to the substance of any change represented by a substitute certificate, cover note, other form of confirmation of insurance coverage, or endorsement as compared with the coverage as originally placed or issued.
History.—s. 362, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 71-18; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; s. 18, ch. 89-360; ss. 171, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 4, ch. 2001-213.
626.924 Information required on contract.—
(1) Each surplus lines agent through whom a surplus lines coverage is procured shall write or print on the outside of the policy and on any certificate, cover note, or other confirmation of the insurance his or her name, address, and identification number and the name and address of the producing agent through whom the business originated and shall have stamped or written upon the first page of the policy or the certificate, cover note, or confirmation of insurance the words: THIS INSURANCE IS ISSUED PURSUANT TO THE FLORIDA SURPLUS LINES LAW. PERSONS INSURED BY SURPLUS LINES CARRIERS DO NOT HAVE THE PROTECTION OF THE FLORIDA INSURANCE GUARANTY ACT TO THE EXTENT OF ANY RIGHT OF RECOVERY FOR THE OBLIGATION OF AN INSOLVENT UNLICENSED INSURER.
(2) Surplus lines policies issued on or after October 1, 2009, shall have stamped or printed on the face of the policy in at least 14-point, boldface type, the following statement: SURPLUS LINES INSURERS’ POLICY RATES AND FORMS ARE NOT APPROVED BY ANY FLORIDA REGULATORY AGENCY.
History.—s. 363, ch. 59-205; s. 5, ch. 63-86; s. 2, ch. 81-318; ss. 305, 318, 807, ch. 82-243; ss. 172, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 303, ch. 97-102; s. 2, ch. 2009-166.
626.925 Surplus lines insurance valid.—Insurance contracts procured as surplus lines coverages from unauthorized insurers in accordance with this law shall be fully valid and enforceable as to all parties and shall be given acceptance and recognition in all matters and respects to the same effect and extent as like contracts issued by authorized insurers.
History.—s. 364, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.926 Liability of insurer as to losses and unearned premiums.—
(1) If an unauthorized insurer or a person authorized by it has bound the risk as to a surplus lines coverage placed under this Surplus Lines Law, and if the premium therefor has been received by the surplus lines agent or originating agent who placed such insurance, then in all questions thereafter arising under the coverage as between the insurer and the insured, the insurer shall be deemed to have received the premium due to it for such coverage; and the insurer shall be liable to the insured as to losses covered by such insurance, and for unearned premiums which may become payable to the insured upon cancellation of such insurance, whether or not in fact the surplus lines agent is indebted to the insurer with respect to such insurance or for any other cause.
(2) Each unauthorized insurer assuming a surplus lines direct risk under this Surplus Lines Law shall be deemed thereby to have subjected itself to the terms of this section.
History.—s. 365, ch. 59-205; s. 2, ch. 81-318; ss. 306, 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.927 Licensing of surplus lines agent.—
(1) Any individual while licensed and appointed as a resident general lines agent as to property, casualty, and surety insurances, and who is deemed by the department to have had sufficient experience in the insurance business to be competent for the purpose, and who, within the 4 years immediately preceding the date the application was submitted, has a minimum of 1 year’s experience working for a licensed surplus lines agent or who has successfully completed 60 class hours in surplus and excess lines in a course approved by the department, may be licensed as a surplus lines agent, upon taking and successfully passing a written examination as to surplus lines, as given by the department.
(2) Any individual while licensed and appointed as a managing general agent as defined in s. 626.015, or service representative as defined in s. 626.015, and who otherwise possesses all of the other qualifications of a general lines agent under this code, and who has a minimum of 1 year’s experience working for a licensed surplus lines agent or who has successfully completed 60 class hours in surplus and excess lines in a course approved by the department, may, upon taking and successfully passing a written examination as to surplus lines, as given by the department, be licensed as a surplus lines agent solely for the purpose of placing with surplus lines insurers property, marine, casualty, or surety coverages originated by general lines agents; except that no examination as for a general lines agent’s license shall be required of any managing general agent or service representative who held a Florida surplus lines agent’s license as of January 1, 1959.
(3) Application for the license shall be made to the department on forms as designated and furnished by it.
(4) License and appointment fees in the amount specified in s. 624.501 shall be paid to the department in advance. The license and appointment of a surplus lines agent continue in force until suspended, revoked, or otherwise terminated. The appointment of a surplus lines agent continues in force until suspended, revoked, or terminated, but is subject to biennial renewal or continuation by the licensee in accordance with procedures prescribed in s. 626.381 for agents in general.
(5) Examinations as to surplus lines, as required under subsections (1) and (2), are subject to the provisions of part I as applicable to applicants for licenses in general.
(6) An individual who has been licensed by the department as a surplus lines agent as provided in this section may be subsequently appointed without additional written examination if his or her application for appointment is filed with the department within 48 months after the date of cancellation or expiration of the prior appointment. The department may require an individual to take and successfully pass an examination as for original issuance of license as a condition precedent to the reinstatement or continuation of the licensee’s current license or reinstatement or continuation of the licensee’s appointment.
History.—s. 366, ch. 59-205; s. 6, ch. 63-86; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 307, 318, 807, ch. 82-243; ss. 173, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 304, ch. 97-102; s. 71, ch. 98-199; s. 20, ch. 2001-142; s. 40, ch. 2002-206; s. 48, ch. 2012-209.
626.9271 Temporary license; death, disability, absence of surplus lines agent.—
(1) The department may, in its discretion, issue a temporary license and appointment as a surplus lines agent to a licensed surplus lines agent’s employee, family member, business associate, or personal representative for the purpose of continuing or winding up the business affairs of the surplus lines agent or agency, subject to the following conditions:
(a) The surplus lines agent being replaced must have died or become unable to perform his or her duties as agent because of military service or illness or other physical or mental disability.
(b) There must be no other person connected with the surplus lines agent’s business who is licensed as a surplus lines agent.
(c) The proposed temporary licensee must be qualified for a regular surplus lines agent’s license under this code except as to residence, examination, education, or experience.
(d) Application for the temporary license and appointment must be made by the applicant upon statements and affidavit filed with the department on forms as prescribed and furnished by it.
(e) The temporary license and appointment shall be issued and be valid for a period of not over 4 months, and may not be renewed to the holder of the temporary license or to any other person for or on behalf of the surplus lines agent or agency.
(2) The applicant for a temporary license and appointment shall pay to the department, prior to the issuance thereof, the applicable license and appointment fees specified in s. 624.501.
(3) The holder of a temporary license may be granted a regular surplus lines agent’s license upon passing an examination as required by s. 626.927.
(4) Except as in this section expressly provided, the holder of a temporary license shall be subject to the same requirements and responsibilities as apply under this code to agents regularly licensed.
History.—ss. 308, 807, ch. 82-243; ss. 174, 205, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 305, ch. 97-102; s. 72, ch. 98-199.
626.9272 Licensing of nonresident surplus lines agents.—
(1) The department may, upon written application and the payment of the fees specified in s. 624.501, issue a nonresident surplus lines agent license to a nonresident individual licensed in his or her home state as a resident general lines and a resident surplus lines agent and otherwise qualified under the laws of this state if, under the laws of the individual’s home state, residents of this state may be licensed in a similar manner as a nonresident surplus lines agent in that state.
(2) The department may not issue a license unless the applicant satisfies the same licensing requirements under s. 626.927 as required of a resident surplus lines agent. The department may refuse to issue such license or appointment when it has reason to believe that any of the grounds exist for denial, suspension, or revocation of a license as set forth in ss. 626.611 and 626.621.
(3) The authority of a nonresident license is limited to the specific lines of authority granted in the license issued by the agent’s home state and the lines authorized under the nonresident license by this state.
(4) Any individual who holds a nonresident agent’s license, upon becoming a resident of this state, may, for a period not to exceed 90 days, operate under the nonresident license and appointment, but must become licensed as a resident agent within that time to continue transacting business in this state after the 90-day period.
(5) Except as provided in this section, nonresident surplus lines agents are subject to the requirements that apply to resident surplus lines agents in this state, including ss. 626.913-626.937.
(6) If available, the department shall verify a nonresident applicant’s licensing status through the producer database maintained by the National Association of Insurance Commissioners, its affiliates, or subsidiaries.
History.—s. 10, ch. 2004-374.
626.929 Origination, acceptance, placement of surplus lines business.—
(1) A general lines agent while licensed and appointed as a surplus lines agent under this part may originate surplus lines business and may accept surplus lines business from any other originating Florida-licensed general lines agent appointed and licensed as to the kinds of insurance involved and may compensate such agent therefor.
(2) A managing general agent while licensed and appointed as a surplus lines agent under this part may accept and place solely such surplus lines business as is originated by a Florida-licensed general lines agent appointed and licensed as to the kinds of insurance involved and may compensate such agent therefor.
(3) No such general lines agent shall knowingly misrepresent to the surplus lines agent any material fact involved in any such insurance or in the eligibility thereof for placement with a surplus lines insurer.
History.—s. 368, ch. 59-205; s. 2, ch. 81-318; ss. 310, 318, 807, ch. 82-243; s. 43, ch. 82-386; ss. 176, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 73, ch. 98-199; s. 11, ch. 2004-374.
626.9295 Corporations, liability of agent.—Any surplus lines insurance agent who is an officer, director, stockholder, or employee of an incorporated surplus lines insurance agency shall remain personally and fully liable and accountable for any wrongful acts, misconduct, or violations of any provisions of this code committed by such licensee or by any person under his or her direct supervision and control while acting on behalf of the corporation.
History.—ss. 312, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 306, ch. 97-102.
626.930 Records of surplus lines agent.—
(1) Each surplus lines agent shall keep in his or her office in this state, or in the agent’s state of residence for a nonresident who does not have an office in this state, a full and true record for a period of 5 years of each surplus lines contract, including applications and all certificates, cover notes, and other forms of confirmation of insurance coverage and any substitutions thereof or endorsements thereto relative to said contract procured by the agent and showing such of the following items as may be applicable:
(a) Amount of the insurance and perils insured against;
(b) Brief general description of property insured and where located;
(c) Gross premium charged;
(d) Return premium paid, if any;
(e) Rate of premium charged upon the several items of property;
(f) Effective date of the contract, and the terms thereof;
(g) Name and post office address of the insured;
(h) Name and home-office address of the insurer;
(i) Amount collected from the insured; and
(j) Other information as may be required by the department.
(2) The record shall at all times be open to examination by the department or the Florida Surplus Lines Service Office without notice and shall be so kept available and open for 5 years next following expiration or cancellation of the contract.
(3) Each surplus lines agent shall maintain all surplus lines business records in his or her general lines agency office, if licensed as a general lines agent, or in his or her managing general agency office, if licensed as a managing general agent or the full-time salaried employee of such general agent.
History.—s. 369, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 311, 318, 807, ch. 82-243; s. 19, ch. 89-360; ss. 177, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 307, ch. 97-102; s. 5, ch. 2001-213; s. 12, ch. 2004-374.
626.931 Agent affidavit and insurer reporting requirements.—
(1) Each surplus lines agent shall on or before the 45th day following each calendar quarter file with the Florida Surplus Lines Service Office an affidavit, on forms as prescribed and furnished by the Florida Surplus Lines Service Office, stating that all surplus lines insurance transacted by him or her during such calendar quarter has been submitted to the Florida Surplus Lines Service Office as required.
(2) The affidavit of the surplus lines agent shall include efforts made to place coverages with authorized insurers and the results thereof.
(3) Each foreign insurer accepting premiums shall, on or before the end of the month following each calendar quarter, file with the Florida Surplus Lines Service Office a verified report of all surplus lines insurance transacted by such insurer for insurance risks located in this state during such calendar quarter.
(4) Each alien insurer accepting premiums shall, on or before June 30 of each year, file with the Florida Surplus Lines Service Office a verified report of all surplus lines insurance transacted by such insurer for insurance risks located in this state during the preceding calendar year.
(5) The department may waive the filing requirements described in subsections (3) and (4).
(6) Each insurer’s report and supporting information shall be in a computer-readable format as determined by the Florida Surplus Lines Service Office or shall be submitted on forms prescribed by the Florida Surplus Lines Service Office and shall show for each applicable agent:
(a) A listing of all policies, certificates, cover notes, or other forms of confirmation of insurance coverage or any substitutions thereof or endorsements thereto and the identifying number; and
(b) Any additional information required by the department or Florida Surplus Lines Service Office.
History.—s. 370, ch. 59-205; s. 7, ch. 63-86; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 313, 318, 807, ch. 82-243; s. 20, ch. 89-360; ss. 205, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 31, ch. 92-146; s. 308, ch. 97-102; s. 4, ch. 97-196; s. 6, ch. 2001-213; s. 1021, ch. 2003-261; s. 1, ch. 2011-46.
626.932 Surplus lines tax.—
(1) The premiums charged for surplus lines coverages are subject to a premium receipts tax of 5 percent of all gross premiums charged for such insurance. The surplus lines agent shall collect from the insured the amount of the tax at the time of the delivery of the cover note, certificate of insurance, policy, or other initial confirmation of insurance, in addition to the full amount of the gross premium charged by the insurer for the insurance. The surplus lines agent is prohibited from absorbing such tax or, as an inducement for insurance or for any other reason, rebating all or any part of such tax or of his or her commission.
(2)(a) The surplus lines agent shall make payable to the department the tax related to each calendar quarter’s business as reported to the Florida Surplus Lines Service Office, and remit the tax to the Florida Surplus Lines Service Office at the same time as provided for the filing of the quarterly affidavit, under s. 626.931. The Florida Surplus Lines Service Office shall forward to the department the taxes and any interest collected pursuant to paragraph (b), within 10 days of receipt.
(b) The agent shall pay interest on the amount of any delinquent tax due, at the rate of 9 percent per year, compounded annually, beginning the day the amount becomes delinquent.
(3) If a surplus lines policy covers risks or exposures only partially in this state and the state is the home state as defined in the federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA), the tax payable shall be computed on the gross premium. The tax must not exceed the tax rate where the risk or exposure is located.
(4) This section does not apply as to insurance of, or with respect to, vessels, cargo, or aircraft written under s. 626.917, or as to insurance of risks of the state government or its agencies, or of any county or municipality or of any agency thereof.
1(5) Taxes collected under this section shall be deposited into the General Revenue Fund.
(6) For the purposes of this section, the term “premium” means the consideration for insurance by whatever name called and includes any assessment, or any membership, policy, survey, inspection, service, or similar fee or charge in consideration for an insurance contract, which items are deemed to be a part of the premium. The per-policy fee authorized by s. 626.916(4) is specifically included within the meaning of the term “premium.” However, the service fee imposed pursuant to s. 626.9325 is excluded from the meaning of the term “premium.”
History.—s. 371, ch. 59-205; s. 15, ch. 65-269; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; s. 46, ch. 90-132; ss. 178, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 32, ch. 92-146; s. 309, ch. 97-102; s. 5, ch. 97-196; s. 7, ch. 2001-213; s. 1022, ch. 2003-261; s. 8, ch. 2003-395; s. 4, ch. 2008-132; ss. 7, 9, ch. 2009-70; s. 2, ch. 2011-46.
1Note.—Section 9, ch. 2009-70, provides that “[t]he amendments to ss. 626.932(5) and 626.938(7), Florida Statutes, made by this act expire July 1, 2014, and the text of those subsections shall revert to that in existence on June 30, 2009, except that any amendments to such text enacted other than by this act shall be preserved and continue to operate to the extent that such amendments are not dependent upon the portions of such text which expire pursuant to this section.” Effective July 1, 2014, subsection (5), as amended by s. 9, ch. 2009-70, will read:
(5) The department shall deposit 15.74 percent of all taxes collected under this section to the credit of the Insurance Regulatory Trust Fund. Eighty-four and twenty-six hundredths percent of all taxes collected under this section shall be deposited into the General Revenue Fund.
626.9325 Service fee.—
(1) The premiums charged for surplus lines insurance are subject to a service fee as provided in s. 626.921(3)(f). The surplus lines agent shall collect from the insured the amount of the fee at the time of the delivery of the policy, or other initial confirmation of insurance, in addition to the full amount of the gross premium charged by the insurer for the insurance. The surplus lines agent is prohibited from absorbing such fee or, as an inducement for insurance or for any other reason, rebating all or any part of such fee or of his or her commission.
(2)(a) The surplus lines agent shall pay on or before the 45th day following each calendar quarter to the Florida Surplus Lines Service Office the fees related to all policies reported during the previous calendar quarter in accordance with the plan of operation of the Florida Surplus Lines Service Office.
(b) The agent shall pay interest on the amount of any delinquent fees due, at the rate of 9 percent per year, compounded annually, beginning the day the amount becomes delinquent.
(3) If a surplus lines policy covers risks or exposures only partially in this state and the state is the home state as defined in the federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA), the fee payable shall be computed on the gross premium.
(4) This section does not apply as to insurance of risks of the state government or its agencies, or of any county or municipality or of any agency thereof.
(5) The association shall use the fees to fund the cost of operations of the Florida Surplus Lines Service Office.
(6) For the purposes of this section, the term “premium” means the consideration for insurance by whatever name called and includes any assessment, or any membership, policy, survey, inspection, service, or similar fee or charge in consideration for an insurance contract, which items are deemed to be a part of the premium. The per-policy fee authorized by s. 626.916(4) is specifically included within the meaning of the term “premium.”
History.—s. 6, ch. 97-196; s. 42, ch. 99-7; s. 3, ch. 2011-46.
626.933 Collection of tax and service fee.—If the tax or service fee payable by a surplus lines agent under the Surplus Lines Law is not so paid within the time prescribed, it shall be recoverable in a suit brought by the department against the surplus lines agent. The department may authorize the Florida Surplus Lines Service Office to file suit on its behalf. All costs and expenses incurred in a suit brought by the office which are not recoverable from the agent or surety shall be borne by the office.
History.—s. 372, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 8, ch. 2001-213; s. 13, ch. 2004-374; s. 50, ch. 2012-209.
626.934 Accounting for funds; contingent commissions.—The following sections also apply as to surplus lines agents:
(1) Section 626.561.
(2) Section 626.581.
(3) Section 626.591.
History.—s. 373, ch. 59-205; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.935 Suspension, revocation, or refusal of surplus lines agent’s license.—
(1) The department shall deny an application for, suspend, revoke, or refuse to renew the appointment of a surplus lines agent and all other licenses and appointments held by the licensee under this code, on any of the following grounds:
(a) Removal of the licensee’s office from the licensee’s state of residence.
(b) Removal of the accounts and records of his or her surplus lines business from this state or the licensee’s state of residence during the period when such accounts and records are required to be maintained under s. 626.930.
(c) Closure of the licensee’s office for more than 30 consecutive days.
(d) Failure to make and file his or her affidavit or reports when due as required by s. 626.931.
(e) Failure to pay the tax or service fee on surplus lines premiums, as provided in the Surplus Lines Law.
(f) Suspension, revocation, or refusal to renew or continue the license or appointment as a general lines agent, service representative, or managing general agent.
(g) Lack of qualifications as for an original surplus lines agent’s license.
(h) Violation of this Surplus Lines Law.
(i) For any other applicable cause for which the license of a general lines agent could be suspended, revoked, or refused under s. 626.611 or s. 626.621.
(2) The department may, in its discretion, deny an application for, suspend, revoke, or refuse to renew the license or appointment of any surplus lines agent upon any applicable ground for which a general lines agent’s license could be suspended, revoked, or refused under s. 626.621.
(3) In the suspension or revocation of, or the refusal to issue or renew, the license or appointment of a surplus lines agent, the department shall follow the same procedures, as applicable, as provided for suspension, revocation, or refusal of licenses of general lines agents, but subject to s. 626.936 as to failure to file a quarterly report or pay the tax.
(4) The following sections also apply, to the extent so applicable, as to surplus lines agents:
(a) Section 626.641.
(b) Section 626.651.
(c) Section 626.661.
(d) Section 626.681.
(e) Section 626.691.
History.—s. 374, ch. 59-205; ss. 13, 35, ch. 69-106; s. 21, ch. 78-95; s. 2, ch. 81-318; ss. 314, 318, 807, ch. 82-243; ss. 179, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 310, ch. 97-102; s. 74, ch. 98-199; s. 9, ch. 2001-213; ss. 14, 45, ch. 2004-374; s. 139, ch. 2007-5; s. 51, ch. 2012-209.
626.936 Failure to file reports or pay tax or service fee; administrative penalty.—
(1) Any licensed surplus lines agent who neglects to file a report or an affidavit in the form and within the time required or provided for in the Surplus Lines Law may be fined up to $50 per day for each day the neglect continues, beginning the day after the report or affidavit was due until the date the report or affidavit is received. All sums collected under this section shall be deposited into the Insurance Regulatory Trust Fund.
(2) Any licensed surplus lines agent who neglects to pay the taxes or service fees as required under the Surplus Lines Law and within the time required may be fined up to $500 per day for each day the failure to pay continues, beginning the day after the tax or service fees were due. The agent shall pay interest on the amount of any delinquent tax due, at the rate of 9 percent per year, compounded annually, beginning the day the amount becomes delinquent. The department shall deposit all sums collected under this section into the Insurance Regulatory Trust Fund.
History.—s. 375, ch. 59-205; ss. 13, 35, ch. 69-106; s. 21, ch. 78-95; s. 2, ch. 81-318; ss. 315, 318, 807, ch. 82-243; s. 21, ch. 89-360; ss. 180, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 33, ch. 92-146; s. 10, ch. 2001-213; s. 1023, ch. 2003-261.
626.9361 Failure to file report; administrative penalty.—Any eligible surplus lines insurer who fails to file a report in the form and within the time required or provided for in the Surplus Lines Law may be fined up to $500 per day for each day such failure continues, beginning the day after the report was due, until the date the report is received. Failure to file a report may also result in withdrawal of eligibility as a surplus lines insurer in this state. All sums collected by the department under this section shall be deposited into the Insurance Regulatory Trust Fund.
History.—s. 34, ch. 92-146; s. 11, ch. 2001-213; s. 1024, ch. 2003-261.
626.9362 Cooperative reciprocal agreement authorized for collection and allocation of certain nonadmitted insurance taxes.—
(1) The Department of Financial Services and the Office of Insurance Regulation may enter into a cooperative reciprocal agreement with another state or group of states for the purpose of, but not limited to, the collection and allocation of nonadmitted insurance taxes for multistate risks pursuant to the federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA) which was incorporated into the Dodd–Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, July 21, 2010.
(2) The terms of the agreement may include, but are not limited to, the following:
(a) Creating a clearinghouse for the purpose of facilitating the receipt and disbursement of nonadmitted insurance taxes.
(b) Specifying requirements and time periods for reporting.
(c) Determining methods for the collection and forwarding of nonadmitted insurance taxes to another state.
(d) Specifying a premium tax allocation formula for multistate risk nonadmitted insurance.
(e) Providing for audits and the exchange of information.
(f) Facilitating the administration of the cooperative reciprocal agreement in a reasonable manner.
(g) Providing for the collection of a service fee to fund the operations and activities of the clearinghouse which shall not exceed 0.3 percent of the gross premium on transactions processed by the clearinghouse.
(3) The Florida Surplus Lines Service Office must implement any cooperative reciprocal agreement entered into by the Department of Financial Services and the Office of Insurance Regulation under this section and has the authority to collect the total tax imposed on a multistate risk nonadmitted insurance premium.
(4) The department and the Office of Insurance Regulation may adopt rules for the administration and enforcement of a cooperative reciprocal agreement entered into with another state or group of states under this section.
(5) Notwithstanding any other provision of law to the contrary, this section and any cooperative reciprocal agreement entered into with another state or group of states under this section control the collection and allocation of nonadmitted insurance taxes for multistate risks.
(6) The Legislature may, at its discretion, review any cooperative reciprocal agreement entered into by the Chief Financial Officer and the office with another state or group of states. If the Legislature determines that the cooperative reciprocal agreement is not in the best interest of the state, the Legislature shall instruct the Chief Financial Officer and the office to withdraw from the cooperative reciprocal agreement, pursuant to any notice provisions required by any such agreement.
(7) Following the negotiation and execution of any cooperative reciprocal agreement entered into by the Department of Financial Services and the Office of Insurance Regulation with another state or group of states, the department shall prepare and submit a report to the President of the Senate and the Speaker of the House of Representatives by January 1, 2012. In addition to describing in detail the terms of any agreement entered into with another state or group of states pursuant to this section, the report must include, but need not be limited to:
(a) The actual and projected collections and allocation of nonadmitted insurance premium taxes for multistate risk of each state participating in the agreement;
(b) A detailed description of the administrative structure supporting any agreement, including any clearinghouse created by an agreement and the fees charged to support administration of the agreement;
(c) The insurance tax rates of any state participating in the agreement; and
(d) The status of any other cooperative reciprocal agreements established throughout the country, including a state-by-state listing of passed or pending legislation responding to changes made by the federal Nonadmitted and Reinsurance Reform Act of 2010.
History.—s. 4, ch. 2011-46.
626.937 Actions against insurer; service of process.—
(1) An unauthorized insurer may be sued upon any cause of action arising in this state under any surplus lines insurance contract issued by it or any certificate, cover note, or other confirmation of such insurance issued by the surplus lines agent, pursuant to the same procedure as is provided in s. 624.423 as to authorized insurers.
(2) The unauthorized insurer accepting the risk or issuing the policy shall be deemed thereby to have authorized service of process against it in the manner and to the effect as provided in this section, and to have appointed the Chief Financial Officer as its agent for service of process issuing upon any cause of action arising in this state under any such policy, contract, or insurance.
(3) Each unauthorized insurer requesting eligibility pursuant to s. 626.918 shall file with the department its appointment of the Chief Financial Officer, on a form as furnished by the department, as its attorney to receive service of all legal process issued against it in any civil action or proceeding in this state, and agreeing that process so served shall be valid and binding upon the insurer. The appointment shall be irrevocable, shall bind the insurer and any successor in interest as to the assets or liabilities of the insurer, and shall remain in effect as long as there is outstanding in this state any obligation or liability of the insurer resulting from its insurance transactions therein.
(4) At the time of such appointment of the Chief Financial Officer as its process agent, the insurer shall file with the department designation of the name and address of the person to whom process against it served upon the Chief Financial Officer is to be forwarded. The insurer may change the designation at any time by a new filing.
(5) This section shall be cumulative to any other methods which may be provided by law for service of process upon the insurer.
History.—s. 376, ch. 59-205; s. 8, ch. 63-86; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 318, 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 311, ch. 97-102; s. 1025, ch. 2003-261.
626.9371 Payment of premiums and claims.—
(1) The premiums for surplus lines insurance contracts issued on or after October 1, 2009, in this state or covering risks located in this state shall be paid in cash consisting of coins, currency, checks, or money orders or by using a debit card, credit card, automatic electronic funds transfer, or payroll deduction plan.
(2) All payments of claims made in this state under any contract of surplus lines insurance issued on or after October 1, 2009, shall be made:
(a) In cash consisting of coins, currency, checks, drafts, or money orders and, if made by check or draft, shall be in such form as will comply with the standards for cash items adopted by the Federal Reserve System to facilitate the sorting, routing, and mechanized processing of such items; or
(b) By debit card or any other form of electronic transfer if authorized in writing by the recipient or the recipient’s representative. Any fees or costs to be charged against the recipient must be disclosed in writing to the recipient or the recipient’s representative at the time of written authorization. However, the written authorization requirement may be waived by the recipient or the recipient’s representative if the insurer verifies the identity of the insured or the insured’s recipient and does not charge a fee for the transaction. If the funds are misdirected, the insurer remains liable for the payment of the claim.
History.—s. 3, ch. 2009-166.
626.9372 Disclosure statement of certain information required; liability claims.—
(1) Each insurer that provides or may provide liability insurance coverage to pay all or a portion of any claim that might be made under surplus lines policies issued on or after October 1, 2009, shall provide, within 60 days after the written request of the claimant, a statement of a corporate officer or the insurer’s claims manager or superintendent setting forth the following information with regard to each known policy of insurance, including excess or umbrella insurance:
(a) The name of the insurer.
(b) The name of each insured.
(c) The limits of the liability coverage.
(d) A statement of any policy or coverage defense that such insurer reasonably believes is available to such insurer at the time of filing such statement.
(e) A copy of the policy.
In addition, the insured, or her or his insurance agent, upon written request of the claimant or the claimant’s attorney, shall disclose the name and coverage of each known insurer to the claimant and forward such request for information as required by this subsection to all affected insurers. The insurer shall supply the information required in this subsection to the claimant within 60 days after receipt of such request.
(2) The statement required by subsection (1) must be amended within 60 days after the date of discovery of facts necessitating an amendment to such statement.
History.—s. 4, ch. 2009-166.
626.9373 Attorney’s fees.—
(1) Upon the rendition of a judgment or decree by any court of this state against a surplus lines insurer in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer on or after the effective date of this act, the trial court or, if the insured or beneficiary prevails on appeal, the appellate court, shall adjudge or decree against the insurer in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured’s or beneficiary’s attorney prosecuting the lawsuit for which recovery is awarded.
(2) If awarded, attorney’s fees or compensation shall be included in the judgment or decree rendered in the case.
History.—s. 5, ch. 2009-166.
626.9374 Liability of insureds; deductible and coinsurance.—
(1) Any surplus lines, personal lines residential property insurance policy issued on or after October 1, 2009, containing a separate hurricane or wind deductible must on its face include in at least 14-point, boldface type the following statement: THIS POLICY CONTAINS A SEPARATE DEDUCTIBLE FOR HURRICANE OR WIND LOSSES, WHICH MAY RESULT IN HIGH OUT-OF-POCKET EXPENSES TO YOU.
(2) A surplus lines, personal lines residential property insurance policy issued on or after October 1, 2009, containing a coinsurance provision applicable to hurricane or wind losses must on its face include in at least 14-point, boldface type the following statement: THIS POLICY CONTAINS A CO-PAY PROVISION THAT MAY RESULT IN HIGH OUT-OF-POCKET EXPENSES TO YOU.
History.—s. 6, ch. 2009-166.
626.938 Report and tax of independently procured coverages.—
(1) Every insured who in this state procures or causes to be procured or continues or renews insurance from another state or country with an unauthorized foreign or alien insurer legitimately licensed in that jurisdiction, or any self-insurer who in this state so procures or continues excess loss, catastrophe, or other insurance, upon a subject of insurance resident, located, or to be performed within this state, other than insurance procured through a surplus lines agent pursuant to the Surplus Lines Law of this state or exempted from tax under s. 626.932(4), shall, within 30 days after the date such insurance was so procured, continued, or renewed, file a report of the same with the Florida Surplus Lines Service Office in writing and upon forms designated by the Florida Surplus Lines Service Office and furnished to such an insured upon request, or in a computer readable format as determined by the Florida Surplus Lines Service Office. The report shall show the name and address of the insured or insureds, the name and address of the insurer, the subject of the insurance, a general description of the coverage, the amount of premium currently charged therefor, and such additional pertinent information as is reasonably requested by the Florida Surplus Lines Service Office.
(2) Any insurance on a risk located in this state in an unauthorized insurer legitimately licensed in another state or country procured through solicitations, negotiations, or an application occurring or made outside this state shall be deemed to be insurance procured, continued, or renewed in this state within the intent of subsection (1).
(3) For the general support of the government of this state, there is levied upon the obligation, chose in action, or right represented by the premium charged for such insurance a tax at the rate of 5 percent of the gross amount of such premium and a 0.3 percent service fee pursuant to s. 626.9325. If the policy covers risks or exposures only partially in this state and this state is the home state as defined by the federal Nonadmitted and Reinsurance Reform Act of 2010 (NRRA), the tax and service fee payable shall be computed on the gross premium. The tax must not exceed the tax rate where the risk or exposure is located. The insured shall withhold the amount of the tax and service fee from the amount of premium charged by and otherwise payable to the insurer for such insurance. On or before the 45th day following each calendar quarter after the insurance is procured, continued, or renewed, the insured shall make payable to the department the amount of the tax and make payable to the Florida Surplus Lines Service Office the amount of the service fee. The insured shall remit the tax and the service fee to the Florida Surplus Lines Service Office. The Florida Surplus Lines Service Office shall forward to the department the taxes, and any interest collected pursuant to subsection (5), within 10 days after receipt.
(4) If the insured fails to withhold from the premium the amount of tax and the service fee herein levied, the insured shall be liable for the amount thereof and shall pay that amount to the Florida Surplus Lines Service Office within the time stated in subsection (3).
(5) The tax imposed hereunder, if delinquent, shall bear interest at the rate of 6 percent per year, compounded annually.
(6) The tax shall be collectible from the insured by civil action brought by the department or by distraint.
1(7) Taxes and interest collected under this section shall be deposited into the General Revenue Fund.
(8) This section does not abrogate or modify, and shall not be construed or deemed to abrogate or modify, any provision of s. 626.901, s. 626.902, s. 626.903, or any other provision of this code.
(9) This section does not authorize independent procurement of workers’ compensation insurance, life insurance, or health insurance.
(10) Each report and supporting information shall be in a computer-readable format as determined by the Florida Surplus Lines Service Office or shall be submitted on forms prescribed by the Florida Surplus Lines Service Office.
History.—s. 377, ch. 59-205; s. 9, ch. 63-86; s. 16, ch. 65-269; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 316, 318, 807, ch. 82-243; s. 47, ch. 90-132; ss. 181, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 35, ch. 92-146; s. 12, ch. 2001-213; s. 1026, ch. 2003-261; s. 9, ch. 2003-395; s. 9, ch. 2006-305; s. 5, ch. 2008-132; ss. 8, 9, ch. 2009-70; s. 5, ch. 2011-46.
1Note.—Section 9, ch. 2009-70, provides that “[t]he amendments to ss. 626.932(5) and 626.938(7), Florida Statutes, made by this act expire July 1, 2014, and the text of those subsections shall revert to that in existence on June 30, 2009, except that any amendments to such text enacted other than by this act shall be preserved and continue to operate to the extent that such amendments are not dependent upon the portions of such text which expire pursuant to this section.” Effective July 1, 2014, subsection (7), as amended by s. 9, ch. 2009-70, will read:
(7) The department shall deposit 15.74 percent of all taxes and interest collected under this section to the credit of the Insurance Regulatory Trust Fund. Eighty-four and twenty-six hundredths percent of all taxes and interest collected under this section shall be deposited into the General Revenue Fund.
626.939 Records produced on order.—
(1) Every person by or as to whom insurance is procured or placed in an unauthorized insurer, upon the order of the department, shall produce for examination by the department, or by the authorized representative of the department, all policies and other documents evidencing the insurance and shall disclose to the department the amount of gross premiums paid or agreed to be paid for the insurance. For each refusal to obey such order, such person, upon conviction thereof, shall be liable to a fine of not more than $500.
(2) This section does not apply to life insurance or health insurance.
History.—s. 378, ch. 59-205; ss. 13, 35, ch. 69-106; s. 2, ch. 81-318; ss. 317, 318, 807, ch. 82-243; ss. 182, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 36, ch. 92-146; s. 23, ch. 99-3.
PART IX
UNFAIR INSURANCE TRADE PRACTICES626.951 Declaration of purpose.
626.9511 Definitions.
626.9521 Unfair methods of competition and unfair or deceptive acts or practices prohibited; penalties.
626.9531 Identification of insurers, agents, and insurance contracts.
626.9541 Unfair methods of competition and unfair or deceptive acts or practices defined.
626.9543 Holocaust victims.
626.9545 Improper charge identification incentive program.
626.9551 Favored agent or insurer; coercion of debtors.
626.9561 Power of department and office.
626.9571 Defined practices; hearings, witnesses, appearances, production of books and service of process.
626.9581 Cease and desist and penalty orders.
626.9591 Appeals from the department or office.
626.9601 Penalty for violation of cease and desist orders.
626.9611 Rules.
626.9621 Provisions of part additional to existing law.
626.9631 Civil liability.
626.9641 Policyholders, bill of rights.
626.9651 Privacy.
626.9701 Rate increases and premium surcharges; consideration of certain noncriminal violations for excessive speed prohibited.
626.9702 Illegal dealings in premiums; excess charges for insurance.
626.9705 Life or disability insurance; illegal dealings.
626.9706 Life insurance; discrimination on basis of sickle-cell trait prohibited.
626.9707 Disability insurance; discrimination on basis of sickle-cell trait prohibited.
626.973 Fictitious groups.
626.9741 Use of credit reports and credit scores by insurers.
626.9743 Claim settlement practices relating to motor vehicle insurance.
626.9744 Claim settlement practices relating to property insurance.
626.9885 Financial institutions conducting insurance transactions.
626.989 Investigation by department or Division of Insurance Fraud; compliance; immunity; confidential information; reports to division; division investigator’s power of arrest.
626.9891 Insurer anti-fraud investigative units; reporting requirements; penalties for noncompliance.
626.9892 Anti-Fraud Reward Program; reporting of insurance fraud.
626.9893 Disposition of revenues; criminal or forfeiture proceedings.
626.9894 Gifts and grants.
626.9895 Motor vehicle insurance fraud direct-support organization.
626.99 Life insurance solicitation.
626.951 Declaration of purpose.—
(1) The purpose of this part is to regulate trade practices relating to the business of insurance in accordance with the intent of Congress as expressed in the Act of Congress of March 9, 1945 (Pub. L. No. 15, 79th Congress), by defining, or providing for the determination of, all such practices in this state which constitute unfair methods of competition or unfair or deceptive acts or practices and by prohibiting the trade practices so defined or determined.
(2) This part shall be entitled the “Unfair Insurance Trade Practices Act.”
History.—s. 379, ch. 59-205; s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.9511 Definitions.—When used in this part:
(1) “Person” means any individual, corporation, association, partnership, reciprocal exchange, interinsurer, Lloyds insurer, fraternal benefit society, or business trust or any entity involved in the business of insurance.
(2) “Insurance policy” or “insurance contract” means a written contract of, or a written agreement for or effecting, insurance, or the certificate thereof, by whatever name called, and includes all clauses, riders, endorsements, and papers which are a part thereof.
History.—s. 9, ch. 76-260; s. 1, ch. 77-174; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1027, ch. 2003-261.
1626.9521 Unfair methods of competition and unfair or deceptive acts or practices prohibited; penalties.—
(1) No person shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 626.951 or s. 626.9561 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of insurance.
(2) Except as provided in subsection (3), any person who violates any provision of this part is subject to a fine in an amount not greater than $5,000 for each nonwillful violation and not greater than $40,000 for each willful violation. Fines under this subsection imposed against an insurer may not exceed an aggregate amount of $20,000 for all nonwillful violations arising out of the same action or an aggregate amount of $200,000 for all willful violations arising out of the same action. The fines may be imposed in addition to any other applicable penalty.
(3)(a) If a person violates s. 626.9541(1)(l), the offense known as “twisting,” or violates s. 626.9541(1)(aa), the offense known as “churning,” the person commits a misdemeanor of the first degree, punishable as provided in s. 775.082, and an administrative fine not greater than $5,000 shall be imposed for each nonwillful violation or an administrative fine not greater than $75,000 shall be imposed for each willful violation. To impose an administrative fine for a willful violation under this paragraph, the practice of “churning” or “twisting” must involve fraudulent conduct.
(b) If a person violates s. 626.9541(1)(ee) by willfully submitting fraudulent signatures on an application or policy-related document, the person commits a felony of the third degree, punishable as provided in s. 775.082, and an administrative fine not greater than $5,000 shall be imposed for each nonwillful violation or an administrative fine not greater than $75,000 shall be imposed for each willful violation.
(c) Administrative fines under this subsection may not exceed an aggregate amount of $50,000 for all nonwillful violations arising out of the same action or an aggregate amount of $250,000 for all willful violations arising out of the same action.
(4) A licensee must make all reasonable efforts to ascertain the consumer’s age at the time an insurance application is completed.
(5) If a consumer who is a senior citizen is a victim, a video deposition of the victim may be used for any purpose in any administrative proceeding conducted pursuant to chapter 120 if all parties are given proper notice of the deposition in accordance with the Florida Rules of Civil Procedure.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 37, ch. 92-146; s. 7, ch. 2008-66; ss. 5, 6, ch. 2008-237; s. 50, ch. 2010-175.
1Note.—Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
626.9531 Identification of insurers, agents, and insurance contracts.—
(1) Advertising materials and other communications developed by insurers, or other risk bearing entities authorized under this code and approved by the office to do business in this state, regarding insurance products shall clearly indicate that the communication relates to insurance products. When soliciting or selling insurance products, agents shall clearly indicate to prospective insureds that they are acting as insurance agents with regard to insurance products and identified insurers, or other risk bearing entities authorized under this code and approved by the office to do business in this state.
(2) There shall be no liability to the insured on the part of, and no cause of action of any nature shall arise against, any licensed and appointed insurance agent for the insolvency of any risk bearing entity when such entity has been duly authorized or approved by the office to do business in this state. However, if the licensed and appointed agent was a controlling producer, as defined in s. 626.7491(2), of the risk bearing entity within 2 years preceding the insolvency, the agent is subject to penalty as provided in s. 626.7491(8).
(3) For the purposes of this section, the term “risk bearing entity” means a reciprocal insurer as defined in s. 629.021, a commercial self-insurance fund as defined in s. 624.462, a group self-insurance fund as defined in s. 624.4621, a local government self-insurance fund as defined in s. 624.4622, a self-insured public utility as defined in s. 624.46225, or an independent educational institution self-insurance fund as defined in s. 624.4623. For the purposes of this section, the term “risk bearing entity” does not include an authorized insurer as defined in s. 624.09.
History.—s. 21, ch. 2001-142; s. 9, ch. 2007-199.
626.9541 Unfair methods of competition and unfair or deceptive acts or practices defined.—
(1) UNFAIR METHODS OF COMPETITION AND UNFAIR OR DECEPTIVE ACTS.—The following are defined as unfair methods of competition and unfair or deceptive acts or practices:
(a) Misrepresentations and false advertising of insurance policies.—Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, comparison, or property and casualty certificate of insurance altered after being issued, which:
1. Misrepresents the benefits, advantages, conditions, or terms of any insurance policy.
2. Misrepresents the dividends or share of the surplus to be received on any insurance policy.
3. Makes any false or misleading statements as to the dividends or share of surplus previously paid on any insurance policy.
4. Is misleading, or is a misrepresentation, as to the financial condition of any person or as to the legal reserve system upon which any life insurer operates.
5. Uses any name or title of any insurance policy or class of insurance policies misrepresenting the true nature thereof.
6. Is a misrepresentation for the purpose of inducing, or tending to induce, the lapse, forfeiture, exchange, conversion, or surrender of any insurance policy.
7. Is a misrepresentation for the purpose of effecting a pledge or assignment of, or effecting a loan against, any insurance policy.
8. Misrepresents any insurance policy as being shares of stock or misrepresents ownership interest in the company.
9. Uses any advertisement that would mislead or otherwise cause a reasonable person to believe mistakenly that the state or the Federal Government is responsible for the insurance sales activities of any person or stands behind any person’s credit or that any person, the state, or the Federal Government guarantees any returns on insurance products or is a source of payment of any insurance obligation of or sold by any person.
(b) False information and advertising generally.—Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public:
1. In a newspaper, magazine, or other publication,
2. In the form of a notice, circular, pamphlet, letter, or poster,
3. Over any radio or television station, or
4. In any other way,
an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of insurance, which is untrue, deceptive, or misleading.
(c) Defamation.—Knowingly making, publishing, disseminating, or circulating, directly or indirectly, or aiding, abetting, or encouraging the making, publishing, disseminating, or circulating of, any oral or written statement, or any pamphlet, circular, article, or literature, which is false or maliciously critical of, or derogatory to, any person and which is calculated to injure such person.
(d) Boycott, coercion, and intimidation.—Entering into any agreement to commit, or by any concerted action committing, any act of boycott, coercion, or intimidation resulting in, or tending to result in, unreasonable restraint of, or monopoly in, the business of insurance.
(e) False statements and entries.—
1. Knowingly:
a. Filing with any supervisory or other public official,
b. Making, publishing, disseminating, circulating,
c. Delivering to any person,
d. Placing before the public,
e. Causing, directly or indirectly, to be made, published, disseminated, circulated, delivered to any person, or placed before the public,
any false material statement.
2. Knowingly making any false entry of a material fact in any book, report, or statement of any person, or knowingly omitting to make a true entry of any material fact pertaining to the business of such person in any book, report, or statement of such person.
(f) Stock operations and advisory board contracts.—Issuing or delivering, promising to issue or deliver, or permitting agents, officers, or employees to issue or deliver, agency company stock or other capital stock, benefit certificates or shares in any common-law corporation, or securities or any special or advisory board contracts or other contracts of any kind promising returns or profits as an inducement to insurance.
(g) Unfair discrimination.—
1. Knowingly making or permitting any unfair discrimination between individuals of the same actuarially supportable class and equal expectation of life, in the rates charged for any life insurance or annuity contract, in the dividends or other benefits payable thereon, or in any other of the terms and conditions of such contract.
2. Knowingly making or permitting any unfair discrimination between individuals of the same actuarially supportable class, as determined at the original time of issuance of the coverage, and essentially the same hazard, in the amount of premium, policy fees, or rates charged for any policy or contract of accident, disability, or health insurance, in the benefits payable thereunder, in any of the terms or conditions of such contract, or in any other manner whatever.
3. For a health insurer, life insurer, disability insurer, property and casualty insurer, automobile insurer, or managed care provider to underwrite a policy, or refuse to issue, reissue, or renew a policy, refuse to pay a claim, cancel or otherwise terminate a policy, or increase rates based upon the fact that an insured or applicant who is also the proposed insured has made a claim or sought or should have sought medical or psychological treatment in the past for abuse, protection from abuse, or shelter from abuse, or that a claim was caused in the past by, or might occur as a result of, any future assault, battery, or sexual assault by a family or household member upon another family or household member as defined in s. 741.28. A health insurer, life insurer, disability insurer, or managed care provider may refuse to underwrite, issue, or renew a policy based on the applicant’s medical condition, but shall not consider whether such condition was caused by an act of abuse. For purposes of this section, the term “abuse” means the occurrence of one or more of the following acts:
a. Attempting or committing assault, battery, sexual assault, or sexual battery;
b. Placing another in fear of imminent serious bodily injury by physical menace;
c. False imprisonment;
d. Physically or sexually abusing a minor child; or
e. An act of domestic violence as defined in s. 741.28.
This subparagraph does not prohibit a property and casualty insurer or an automobile insurer from excluding coverage for intentional acts by the insured if such exclusion does not constitute an act of unfair discrimination as defined in this paragraph.
(h) Unlawful rebates.—
1. Except as otherwise expressly provided by law, or in an applicable filing with the office, knowingly:
a. Permitting, or offering to make, or making, any contract or agreement as to such contract other than as plainly expressed in the insurance contract issued thereon;
b. Paying, allowing, or giving, or offering to pay, allow, or give, directly or indirectly, as inducement to such insurance contract, any unlawful rebate of premiums payable on the contract, any special favor or advantage in the dividends or other benefits thereon, or any valuable consideration or inducement whatever not specified in the contract;
c. Giving, selling, or purchasing, or offering to give, sell, or purchase, as inducement to such insurance contract or in connection therewith, any stocks, bonds, or other securities of any insurance company or other corporation, association, or partnership, or any dividends or profits accrued thereon, or anything of value whatsoever not specified in the insurance contract.
2. Nothing in paragraph (g) or subparagraph 1. of this paragraph shall be construed as including within the definition of discrimination or unlawful rebates:
a. In the case of any contract of life insurance or life annuity, paying bonuses to all policyholders or otherwise abating their premiums in whole or in part out of surplus accumulated from nonparticipating insurance; provided that any such bonuses or abatement of premiums is fair and equitable to all policyholders and for the best interests of the company and its policyholders.
b. In the case of life insurance policies issued on the industrial debit plan, making allowance to policyholders who have continuously for a specified period made premium payments directly to an office of the insurer in an amount which fairly represents the saving in collection expenses.
c. Readjustment of the rate of premium for a group insurance policy based on the loss or expense thereunder, at the end of the first or any subsequent policy year of insurance thereunder, which may be made retroactive only for such policy year.
d. Issuance of life insurance policies or annuity contracts at rates less than the usual rates of premiums for such policies or contracts, as group insurance or employee insurance as defined in this code.
e. Issuing life or disability insurance policies on a salary savings, bank draft, preauthorized check, payroll deduction, or other similar plan at a reduced rate reasonably related to the savings made by the use of such plan.
3.a. No title insurer, or any member, employee, attorney, agent, or agency thereof, shall pay, allow, or give, or offer to pay, allow, or give, directly or indirectly, as inducement to title insurance, or after such insurance has been effected, any rebate or abatement of the premium or any other charge or fee, or provide any special favor or advantage, or any monetary consideration or inducement whatever.
b. Nothing in this subparagraph shall be construed as prohibiting the payment of fees to attorneys at law duly licensed to practice law in the courts of this state, for professional services, or as prohibiting the payment of earned portions of the premium to duly appointed agents or agencies who actually perform services for the title insurer. Nothing in this subparagraph shall be construed as prohibiting a rebate or abatement of an attorney fee charged for professional services, or that portion of the premium that is not required to be retained by the insurer pursuant to s. 627.782(1), or any other agent charge or fee to the person responsible for paying the premium, charge, or fee.
c. No insured named in a policy, or any other person directly or indirectly connected with the transaction involving the issuance of such policy, including, but not limited to, any mortgage broker, real estate broker, builder, or attorney, any employee, agent, agency, or representative thereof, or any other person whatsoever, shall knowingly receive or accept, directly or indirectly, any rebate or abatement of any portion of the title insurance premium or of any other charge or fee or any monetary consideration or inducement whatsoever, except as set forth in sub-subparagraph b.; provided, in no event shall any portion of the attorney fee, any portion of the premium that is not required to be retained by the insurer pursuant to s. 627.782(1), any agent charge or fee, or any other monetary consideration or inducement be paid directly or indirectly for the referral of title insurance business.
(i) Unfair claim settlement practices.—
1. Attempting to settle claims on the basis of an application, when serving as a binder or intended to become a part of the policy, or any other material document which was altered without notice to, or knowledge or consent of, the insured;
2. A material misrepresentation made to an insured or any other person having an interest in the proceeds payable under such contract or policy, for the purpose and with the intent of effecting settlement of such claims, loss, or damage under such contract or policy on less favorable terms than those provided in, and contemplated by, such contract or policy; or
3. Committing or performing with such frequency as to indicate a general business practice any of the following:
a. Failing to adopt and implement standards for the proper investigation of claims;
b. Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue;
c. Failing to acknowledge and act promptly upon communications with respect to claims;
d. Denying claims without conducting reasonable investigations based upon available information;
e. Failing to affirm or deny full or partial coverage of claims, and, as to partial coverage, the dollar amount or extent of coverage, or failing to provide a written statement that the claim is being investigated, upon the written request of the insured within 30 days after proof-of-loss statements have been completed;
f. Failing to promptly provide a reasonable explanation in writing to the insured of the basis in the insurance policy, in relation to the facts or applicable law, for denial of a claim or for the offer of a compromise settlement;
g. Failing to promptly notify the insured of any additional information necessary for the processing of a claim; or
h. Failing to clearly explain the nature of the requested information and the reasons why such information is necessary.
i. Failing to pay personal injury protection insurance claims within the time periods required by s. 627.736(4)(b). The office may order the insurer to pay restitution to a policyholder, medical provider, or other claimant, including interest at a rate consistent with the amount set forth in s. 55.03(1), for the time period within which an insurer fails to pay claims as required by law. Restitution is in addition to any other penalties allowed by law, including, but not limited to, the suspension of the insurer’s certificate of authority.
4. Failing to pay undisputed amounts of partial or full benefits owed under first-party property insurance policies within 90 days after an insurer receives notice of a residential property insurance claim, determines the amounts of partial or full benefits, and agrees to coverage, unless payment of the undisputed benefits is prevented by an act of God, prevented by the impossibility of performance, or due to actions by the insured or claimant that constitute fraud, lack of cooperation, or intentional misrepresentation regarding the claim for which benefits are owed.
(j) Failure to maintain complaint-handling procedures.—Failure of any person to maintain a complete record of all the complaints received since the date of the last examination. For purposes of this paragraph, “complaint” means any written communication primarily expressing a grievance.
(k) Misrepresentation in insurance applications.—
1. Knowingly making a false or fraudulent written or oral statement or representation on, or relative to, an application or negotiation for an insurance policy for the purpose of obtaining a fee, commission, money, or other benefit from any insurer, agent, broker, or individual.
2. Knowingly making a material omission in the comparison of a life, health, or Medicare supplement insurance replacement policy with the policy it replaces for the purpose of obtaining a fee, commission, money, or other benefit from any insurer, agent, broker, or individual. For the purposes of this subparagraph, a material omission includes the failure to advise the insured of the existence and operation of a preexisting condition clause in the replacement policy.
(l) Twisting.—Knowingly making any misleading representations or incomplete or fraudulent comparisons or fraudulent material omissions of or with respect to any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance in another insurer.
(m) Advertising gifts permitted.—No provision of paragraph (f), paragraph (g), or paragraph (h) shall be deemed to prohibit a licensed insurer or its agent from giving to insureds, prospective insureds, and others, for the purpose of advertising, any article of merchandise having a value of not more than $25.
(n) Free insurance prohibited.—
1. Advertising, offering, or providing free insurance as an inducement to the purchase or sale of real or personal property or of services directly or indirectly connected with such real or personal property.
2. For the purposes of this paragraph, “free” insurance is:
a. Insurance for which no identifiable and additional charge is made to the purchaser of such real property, personal property, or services.
b. Insurance for which an identifiable or additional charge is made in an amount less than the cost of such insurance as to the seller or other person, other than the insurer, providing the same.
3. Subparagraphs 1. and 2. do not apply to:
a. Insurance of, loss of, or damage to the real or personal property involved in any such sale or services, under a policy covering the interests therein of the seller or vendor.
b. Blanket disability insurance as defined in s. 627.659.
c. Credit life insurance or credit disability insurance.
d. Any individual, isolated, nonrecurring unadvertised transaction not in the regular course of business.
e. Title insurance.
f. Any purchase agreement involving the purchase of a cemetery lot or lots in which, under stated conditions, any balance due is forgiven upon the death of the purchaser.
g. Life insurance, trip cancellation insurance, or lost baggage insurance offered by a travel agency as part of a travel package offered by and booked through the agency.
4. Using the word “free” or words which imply the provision of insurance without a cost to describe life or disability insurance, in connection with the advertising or offering for sale of any kind of goods, merchandise, or services.
(o) Illegal dealings in premiums; excess or reduced charges for insurance.—
1. Knowingly collecting any sum as a premium or charge for insurance, which is not then provided, or is not in due course to be provided, subject to acceptance of the risk by the insurer, by an insurance policy issued by an insurer as permitted by this code.
2. Knowingly collecting as a premium or charge for insurance any sum in excess of or less than the premium or charge applicable to such insurance, in accordance with the applicable classifications and rates as filed with and approved by the office, and as specified in the policy; or, in cases when classifications, premiums, or rates are not required by this code to be so filed and approved, premiums and charges collected from a Florida resident in excess of or less than those specified in the policy and as fixed by the insurer. This provision shall not be deemed to prohibit the charging and collection, by surplus lines agents licensed under part VIII of this chapter, of the amount of applicable state and federal taxes, or fees as authorized by s. 626.916(4), in addition to the premium required by the insurer or the charging and collection, by licensed agents, of the exact amount of any discount or other such fee charged by a credit card facility in connection with the use of a credit card, as authorized by subparagraph (q)3., in addition to the premium required by the insurer. This subparagraph shall not be construed to prohibit collection of a premium for a universal life or a variable or indeterminate value insurance policy made in accordance with the terms of the contract.
3.a. Imposing or requesting an additional premium for a policy of motor vehicle liability, personal injury protection, medical payment, or collision insurance or any combination thereof or refusing to renew the policy solely because the insured was involved in a motor vehicle accident unless the insurer’s file contains information from which the insurer in good faith determines that the insured was substantially at fault in the accident.
b. An insurer which imposes and collects such a surcharge or which refuses to renew such policy shall, in conjunction with the notice of premium due or notice of nonrenewal, notify the named insured that he or she is entitled to reimbursement of such amount or renewal of the policy under the conditions listed below and will subsequently reimburse him or her or renew the policy, if the named insured demonstrates that the operator involved in the accident was:
(I) Lawfully parked;
(II) Reimbursed by, or on behalf of, a person responsible for the accident or has a judgment against such person;
(III) Struck in the rear by another vehicle headed in the same direction and was not convicted of a moving traffic violation in connection with the accident;
(IV) Hit by a “hit-and-run” driver, if the accident was reported to the proper authorities within 24 hours after discovering the accident;
(V) Not convicted of a moving traffic violation in connection with the accident, but the operator of the other automobile involved in such accident was convicted of a moving traffic violation;
(VI) Finally adjudicated not to be liable by a court of competent jurisdiction;
(VII) In receipt of a traffic citation which was dismissed or nolle prossed; or
(VIII) Not at fault as evidenced by a written statement from the insured establishing facts demonstrating lack of fault which are not rebutted by information in the insurer’s file from which the insurer in good faith determines that the insured was substantially at fault.
c. In addition to the other provisions of this subparagraph, an insurer may not fail to renew a policy if the insured has had only one accident in which he or she was at fault within the current 3-year period. However, an insurer may nonrenew a policy for reasons other than accidents in accordance with s. 627.728. This subparagraph does not prohibit nonrenewal of a policy under which the insured has had three or more accidents, regardless of fault, during the most recent 3-year period.
4. Imposing or requesting an additional premium for, or refusing to renew, a policy for motor vehicle insurance solely because the insured committed a noncriminal traffic infraction as described in s. 318.14 unless the infraction is:
a. A second infraction committed within an 18-month period, or a third or subsequent infraction committed within a 36-month period.
b. A violation of s. 316.183, when such violation is a result of exceeding the lawful speed limit by more than 15 miles per hour.
5. Upon the request of the insured, the insurer and licensed agent shall supply to the insured the complete proof of fault or other criteria which justifies the additional charge or cancellation.
6. No insurer shall impose or request an additional premium for motor vehicle insurance, cancel or refuse to issue a policy, or refuse to renew a policy because the insured or the applicant is a handicapped or physically disabled person, so long as such handicap or physical disability does not substantially impair such person’s mechanically assisted driving ability.
7. No insurer may cancel or otherwise terminate any insurance contract or coverage, or require execution of a consent to rate endorsement, during the stated policy term for the purpose of offering to issue, or issuing, a similar or identical contract or coverage to the same insured with the same exposure at a higher premium rate or continuing an existing contract or coverage with the same exposure at an increased premium.
8. No insurer may issue a nonrenewal notice on any insurance contract or coverage, or require execution of a consent to rate endorsement, for the purpose of offering to issue, or issuing, a similar or identical contract or coverage to the same insured at a higher premium rate or continuing an existing contract or coverage at an increased premium without meeting any applicable notice requirements.
9. No insurer shall, with respect to premiums charged for motor vehicle insurance, unfairly discriminate solely on the basis of age, sex, marital status, or scholastic achievement.
10. Imposing or requesting an additional premium for motor vehicle comprehensive or uninsured motorist coverage solely because the insured was involved in a motor vehicle accident or was convicted of a moving traffic violation.
11. No insurer shall cancel or issue a nonrenewal notice on any insurance policy or contract without complying with any applicable cancellation or nonrenewal provision required under the Florida Insurance Code.
12. No insurer shall impose or request an additional premium, cancel a policy, or issue a nonrenewal notice on any insurance policy or contract because of any traffic infraction when adjudication has been withheld and no points have been assessed pursuant to s. 318.14(9) and (10). However, this subparagraph does not apply to traffic infractions involving accidents in which the insurer has incurred a loss due to the fault of the insured.
(p) Insurance cost specified in “price package”.—
1. When the premium or charge for insurance of or involving such property or merchandise is included in the overall purchase price or financing of the purchase of merchandise or property, the vendor or lender shall separately state and identify the amount charged and to be paid for the insurance, and the classifications, if any, upon which based; and the inclusion or exclusion of the cost of insurance in such purchase price or financing shall not increase, reduce, or otherwise affect any other factor involved in the cost of the merchandise, property, or financing as to the purchaser or borrower.
2. This paragraph does not apply to transactions which are subject to the provisions of part I of chapter 520, entitled “The Motor Vehicle Sales Finance Act.”
3. This paragraph does not apply to credit life or credit disability insurance which is in compliance with s. 627.681(4).
(q) Certain insurance transactions through credit card facilities prohibited.—
1. Except as provided in subparagraph 3., no person shall knowingly solicit or negotiate any insurance; seek or accept applications for insurance; issue or deliver any policy; receive, collect, or transmit premiums, to or for any insurer; or otherwise transact insurance in this state, or relative to a subject of insurance resident, located, or to be performed in this state, through the arrangement or facilities of a credit card facility or organization, for the purpose of insuring credit card holders or prospective credit card holders. The term “credit card holder” as used in this paragraph means any person who may pay the charge for purchases or other transactions through the credit card facility or organization, whose credit with such facility or organization is evidenced by a credit card identifying such person as being one whose charges the credit card facility or organization will pay, and who is identified as such upon the credit card either by name, account number, symbol, insignia, or any other method or device of identification. This subparagraph does not apply as to health insurance or to credit life, credit disability, or credit property insurance.
2. Whenever any person does or performs in this state any of the acts in violation of subparagraph 1. for or on behalf of any insurer or credit card facility, such insurer or credit card facility shall be held to be doing business in this state and, if an insurer, shall be subject to the same state, county, and municipal taxes as insurers that have been legally qualified and admitted to do business in this state by agents or otherwise are subject, the same to be assessed and collected against such insurers; and such person so doing or performing any of such acts shall be personally liable for all such taxes.
3. A licensed agent or insurer may solicit or negotiate any insurance; seek or accept applications for insurance; issue or deliver any policy; receive, collect, or transmit premiums, to or for any insurer; or otherwise transact insurance in this state, or relative to a subject of insurance resident, located, or to be performed in this state, through the arrangement or facilities of a credit card facility or organization, for the purpose of insuring credit card holders or prospective credit card holders if:
a. The insurance or policy which is the subject of the transaction is noncancelable by any person other than the named insured, the policyholder, or the insurer;
b. Any refund of unearned premium is made directly to the credit card holder; and
c. The credit card transaction is authorized by the signature of the credit card holder or other person authorized to sign on the credit card account.
The conditions enumerated in sub-subparagraphs a.-c. do not apply to health insurance or to credit life, credit disability, or credit property insurance; and sub-subparagraph c. does not apply to property and casualty insurance so long as the transaction is authorized by the insured.
4. No person may use or disclose information resulting from the use of a credit card in conjunction with the purchase of insurance, when such information is to the advantage of such credit card facility or an insurance agent, or is to the detriment of the insured or any other insurance agent; except that this provision does not prohibit a credit card facility from using or disclosing such information in any judicial proceeding or consistent with applicable law on credit reporting.
5. No such insurance shall be sold through a credit card facility in conjunction with membership in any automobile club. The term “automobile club” means a legal entity which, in consideration of dues, assessments, or periodic payments of money, promises its members or subscribers to assist them in matters relating to the ownership, operation, use, or maintenance of a motor vehicle; however, the definition of automobile clubs does not include persons, associations, or corporations which are organized and operated solely for the purpose of conducting, sponsoring, or sanctioning motor vehicle races, exhibitions, or contests upon racetracks, or upon race courses established and marked as such for the duration of such particular event. The words “motor vehicle” used herein shall be the same as defined in chapter 320.
(r) Interlocking ownership and management.—
1. Any domestic insurer may retain, invest in, or acquire the whole or any part of the capital stock of any other insurer or insurers, or have a common management with any other insurer or insurers, unless such retention, investment, acquisition, or common management is inconsistent with any other provision of this code, or unless by reason thereof the business of such insurers with the public is conducted in a manner which substantially lessens competition generally in the insurance business.
2. Any person otherwise qualified may be a director of two or more domestic insurers which are competitors, unless the effect thereof is substantially to lessen competition between insurers generally or materially tend to create a monopoly.
3. Any limitation contained in this paragraph does not apply to any person who is a director of two or more insurers under common control or management.
(s) Prohibited arrangements as to funerals.—
1. No life insurer shall designate in any life insurance policy the person to conduct the funeral of the insured, or organize, promote, or operate any enterprise or plan to enter into any contract with any insured under which the freedom of choice in the open market of the person having the legal right to such choice is restricted as to the purchase, arrangement, and conduct of a funeral service or any part thereof for any individual insured by the insurer. No life insurer shall designate in any life insurance policy the person to conduct the funeral of the insured as the owner of the policy.
2. No insurer shall contract or agree to furnish funeral merchandise or services in connection with the disposition of any person upon the death of any person insured by such insurer.
3. No insurer shall contract or agree with any funeral director or direct disposer to the effect that such funeral director or direct disposer shall conduct the funeral of any person insured by such insurer.
4. No insurer shall provide, in any insurance contract covering the life of any person in this state, for the payment of the proceeds or benefits thereof in other than legal tender of the United States and of this state, or for the withholding of such proceeds or benefits, all for the purpose of either directly or indirectly providing, inducing, or furthering any arrangement or agreement designed to require or induce the employment of a particular person to conduct the funeral of the insured.
(t) Certain life insurance relations with funeral directors prohibited.—
1. No life insurer shall permit any funeral director or direct disposer to act as its representative, adjuster, claim agent, special claim agent, or agent for such insurer in soliciting, negotiating, or effecting contracts of life insurance on any plan or of any nature issued by such insurer or in collecting premiums for holders of any such contracts except as prescribed in s. 626.785(3).
2. No life insurer shall:
a. Affix, or permit to be affixed, advertising matter of any kind or character of any licensed funeral director or direct disposer to such policies of insurance.
b. Circulate, or permit to be circulated, any such advertising matter with such insurance policies.
c. Attempt in any manner or form to influence policyholders of the insurer to employ the services of any particular licensed funeral director or direct disposer.
3. No such insurer shall maintain, or permit its agent to maintain, an office or place of business in the office, establishment, or place of business of any funeral director or direct disposer in this state.
(u) False claims; obtaining or retaining money dishonestly.—
1. Any agent, physician, claimant, or other person who causes to be presented to any insurer a false claim for payment, knowing the same to be false; or
2. Any agent, collector, or other person who represents any insurer or collects or does business without the authority of the insurer, secures cash advances by false statements, or fails to turn over when required, or satisfactorily account for, all collections of such insurer,
shall, in addition to the other penalties provided in this act, be guilty of a misdemeanor of the second degree and, upon conviction thereof, shall be subject to the penalties provided by s. 775.082 or s. 775.083.
(v) Proposal required.—If a person simultaneously holds a securities license and a life insurance license, he or she shall prepare and leave with each prospective buyer a written proposal, on or before delivery of any investment plan. “Investment plan” means a mutual funds program, and the proposal shall consist of a prospectus describing the investment feature and a full illustration of any life insurance feature. The proposal shall be prepared in duplicate, dated, and signed by the licensee. The original shall be left with the prospect, the duplicate shall be retained by the licensee for a period of not less than 3 years, and a copy shall be furnished to the department upon its request. In lieu of a duplicate copy, a receipt for standardized proposals filed with the department may be obtained and held by the licensee.
(w) Soliciting or accepting new or renewal insurance risks by insolvent or impaired insurer prohibited; penalty.—
1. Whether or not delinquency proceedings as to the insurer have been or are to be initiated, but while such insolvency or impairment exists, no director or officer of an insurer, except with the written permission of the office, shall authorize or permit the insurer to solicit or accept new or renewal insurance risks in this state after such director or officer knew, or reasonably should have known, that the insurer was insolvent or impaired. “Impaired” includes impairment of capital or surplus, as defined in s. 631.011(12) and (13).
2. Any such director or officer, upon conviction of a violation of this paragraph, is guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(x) Refusal to insure.—In addition to other provisions of this code, the refusal to insure, or continue to insure, any individual or risk solely because of:
1. Race, color, creed, marital status, sex, or national origin;
2. The residence, age, or lawful occupation of the individual or the location of the risk, unless there is a reasonable relationship between the residence, age, or lawful occupation of the individual or the location of the risk and the coverage issued or to be issued;
3. The insured’s or applicant’s failure to agree to place collateral business with any insurer, unless the coverage applied for would provide liability coverage which is excess over that provided in policies maintained on property or motor vehicles;
4. The insured’s or applicant’s failure to purchase noninsurance services or commodities, including automobile services as defined in s. 624.124;
5. The fact that the insured or applicant is a public official; or
6. The fact that the insured or applicant had been previously refused insurance coverage by any insurer, when such refusal to insure or continue to insure for this reason occurs with such frequency as to indicate a general business practice.
(y) Powers of attorney.—Except as provided in s. 627.842(2):
1. Requiring, as a condition to the purchase or continuation of an insurance policy, that an applicant for insurance or an insured execute a power of attorney in favor of an insurance agent or agency or employee thereof; or
2. Presenting to the applicant or the insured, as a routine business practice, a form that authorizes the insurance agent or agency to sign the applicant’s or insured’s name on any insurance-related document or application for the purchase of motor vehicle services as described in s. 624.124. To be valid, a power of attorney must be an act or practice other than as described in this paragraph, must be a separate writing in a separate document, must be executed with the full knowledge and consent of the applicant or insured who grants the power of attorney, must be in the best interests of the insured or applicant, and a copy of the power of attorney must be provided to the applicant or insured at the time of the transaction.
(z) Sliding.—Sliding is the act or practice of:
1. Representing to the applicant that a specific ancillary coverage or product is required by law in conjunction with the purchase of insurance when such coverage or product is not required;
2. Representing to the applicant that a specific ancillary coverage or product is included in the policy applied for without an additional charge when such charge is required; or
3. Charging an applicant for a specific ancillary coverage or product, in addition to the cost of the insurance coverage applied for, without the informed consent of the applicant.
1(aa) Churning.—
1. Churning is the practice whereby policy values in an existing life insurance policy or annuity contract, including, but not limited to, cash, loan values, or dividend values, and in any riders to that policy or contract, are directly or indirectly used to purchase another insurance policy or annuity contract with that same insurer for the purpose of earning additional premiums, fees, commissions, or other compensation:
a. Without an objectively reasonable basis for believing that the replacement or extraction will result in an actual and demonstrable benefit to the policyholder;
b. In a fashion that is fraudulent, deceptive, or otherwise misleading or that involves a deceptive omission;
c. When the applicant is not informed that the policy values including cash values, dividends, and other assets of the existing policy or contract will be reduced, forfeited, or used in the purchase of the replacing or additional policy or contract, if this is the case; or
d. Without informing the applicant that the replacing or additional policy or contract will not be a paid-up policy or that additional premiums will be due, if this is the case.
Churning by an insurer or an agent is an unfair method of competition and an unfair or deceptive act or practice.
2. Each insurer shall comply with sub-subparagraphs 1.c. and 1.d. by disclosing to the applicant at the time of the offer on a form designed and adopted by rule by the commission if, how, and the extent to which the policy or contract values (including cash value, dividends, and other assets) of a previously issued policy or contract will be used to purchase a replacing or additional policy or contract with the same insurer. The form must include disclosure of the premium, the death benefit of the proposed replacing or additional policy, and the date when the policy values of the existing policy or contract will be insufficient to pay the premiums of the replacing or additional policy or contract.
3. Each insurer shall adopt written procedures to reasonably avoid churning of policies or contracts that it has issued, and failure to adopt written procedures sufficient to reasonably avoid churning shall be an unfair method of competition and an unfair or deceptive act or practice.
(bb) Deceptive use of name.—Using the name or logo of a financial institution, as defined in s. 655.005(1), or its affiliates or subsidiaries when marketing or soliciting existing or prospective customers if such marketing materials are used without the written consent of the financial institution and in a manner that would lead a reasonable person to believe that the material or solicitation originated from, was endorsed by, or is related to or the responsibility of the financial institution or its affiliates or subsidiaries.
(cc) Unfair rate increases for persons in military service.—Charging an increased premium for reinstating a motor vehicle insurance policy that was canceled or suspended by the insured solely for the reason that he or she was transferred out of this state while serving in the United States Armed Forces or on active duty in the National Guard or United States Armed Forces Reserve. It is also an unfair practice for an insurer to charge an increased premium for a new motor vehicle insurance policy if the applicant for coverage or his or her covered dependents were previously insured with a different insurer and canceled that policy solely for the reason that he or she was transferred out of this state while serving in the United States Armed Forces or on active duty in the National Guard or United States Armed Forces Reserve. For purposes of determining premiums, an insurer shall consider such persons as having maintained continuous coverage.
(dd) Life insurance limitations based on past foreign travel experiences or future foreign travel plans.—
1. An insurer may not refuse life insurance to; refuse to continue the life insurance of; or limit the amount, extent, or kind of life insurance coverage available to an individual based solely on the individual’s past lawful foreign travel experiences.
2. An insurer may not refuse life insurance to; refuse to continue the life insurance of; or limit the amount, extent, or kind of life insurance coverage available to an individual based solely on the individual’s future lawful travel plans unless the insurer can demonstrate and the Office of Insurance Regulation determines that:
a. Individuals who travel are a separate actuarially supportable class whose risk of loss is different from those individuals who do not travel; and
b. Such risk classification is based upon sound actuarial principles and actual or reasonably anticipated experience that correlates to the risk of travel to a specific destination.
3. The commission may adopt rules pursuant to ss. 120.536(1) and 120.54 necessary to implement this paragraph and may provide for limited exceptions that are based upon national or international emergency conditions that affect the public health, safety, and welfare and that are consistent with public policy.
4. Each market conduct examination of a life insurer conducted pursuant to s. 624.3161 shall include a review of every application under which such insurer refused to issue life insurance; refused to continue life insurance; or limited the amount, extent, or kind of life insurance issued, based upon future lawful travel plans.
5. The administrative fines provided in s. 624.4211(2) and (3) shall be trebled for violations of this paragraph.
6. The Office of Insurance Regulation shall report to the President of the Senate and the Speaker of the House of Representatives by March 1, 2007, and on the same date annually thereafter, on the implementation of this paragraph. The report shall include, but not be limited to, the number of applications under which life insurance was denied, continuance was refused, or coverage was limited based on future travel plans; the number of insurers taking such action; and the reason for taking each such action.
1(ee) Fraudulent signatures on an application or policy-related document.—Willfully submitting to an insurer on behalf of a consumer an insurance application or policy-related document bearing a false or fraudulent signature.
1(ff) Unlawful use of designations; misrepresentation of agent qualifications.—
1. A licensee may not, in any sales presentation or solicitation for insurance, use a designation or title in such a way as to falsely imply that the licensee:
a. Possesses special financial knowledge or has obtained specialized financial training; or
b. Is certified or qualified to provide specialized financial advice to senior citizens.
2. A licensee may not use terms such as “financial advisor” in such a way as to falsely imply that the licensee is licensed or qualified to discuss, sell, or recommend financial products other than insurance products.
3. A licensee may not, in any sales presentation or solicitation for insurance, falsely imply that he or she is qualified to discuss, recommend, or sell securities or other investment products in addition to insurance products.
4. A licensee who also holds a designation as a certified financial planner (CFP), chartered life underwriter (CLU), chartered financial consultant (ChFC), life underwriter training council fellow (LUTC), or the appropriate license to sell securities from the Financial Industry Regulatory Authority (FINRA) may inform the customer of those licenses or designations and make recommendations in accordance with those licenses or designations, and in so doing does not violate this paragraph.
(2) ALTERNATIVE RATES OF PAYMENT.—Nothing in this section shall be construed to prohibit an insurer or insurers from negotiating or entering into contracts with licensed health care providers for alternative rates of payment, or from limiting payments under policies pursuant to agreements with insureds, as long as the insurer offers the benefit of such alternative rates to insureds who select designated providers.
(3) INPATIENT FACILITY NETWORK.—This section may not be construed to prohibit a Medicare supplement insurer from granting a premium credit to insureds for using an in-network inpatient facility.
(4) PARTICIPATION IN A WELLNESS OR HEALTH IMPROVEMENT PROGRAM.—
(a) Authorization to offer rewards or incentives for participation.—An insurer issuing a group or individual health benefit plan may offer a voluntary wellness or health improvement program and may encourage or reward participation in the program by authorizing rewards or incentives, including, but not limited to, merchandise, gift cards, debit cards, premium discounts, contributions to a member’s health savings account, or modifications to copayment, deductible, or coinsurance amounts. Any advertisement of the program is not subject to the limitations set forth in paragraph (1)(m).
(b) Verification of medical condition by nonparticipants due to medical condition.—An insurer may require a member of a health benefit plan to provide verification, such as an affirming statement from the member’s physician, that the member’s medical condition makes it unreasonably difficult or inadvisable to participate in the wellness or health improvement program in order for that nonparticipant to receive the reward or incentive.
(c) Disclosure requirement.—A reward or incentive offered under this subsection shall be disclosed in the policy or certificate.
(d) Other incentives.—This subsection does not prohibit insurers from offering other incentives or rewards for adherence to a wellness or health improvement program if otherwise authorized by state or federal law.
History.—s. 9, ch. 76-260; s. 1, ch. 77-174; s. 19, ch. 77-468; s. 1, ch. 78-377; s. 1, ch. 79-289; s. 1, ch. 80-152; s. 1, ch. 80-373; s. 1, ch. 82-235; s. 807, ch. 82-243; s. 90, ch. 83-216; ss. 1, 2, ch. 83-342; s. 1, ch. 84-157; s. 14, ch. 85-62; s. 3, ch. 85-182; s. 1, ch. 85-233; s. 4, ch. 86-160; s. 27, ch. 87-226; s. 13, ch. 88-370; ss. 60, 65, ch. 89-360; s. 1, ch. 90-85; s. 33, ch. 90-119; ss. 186, 206, 207, ch. 90-363; s. 58, ch. 91-110; s. 256, ch. 91-224; s. 4, ch. 91-429; s. 38, ch. 92-146; s. 6, ch. 95-187; s. 1, ch. 95-219; s. 314, ch. 97-102; s. 24, ch. 99-3; s. 5, ch. 99-286; s. 1, ch. 99-388; s. 2, ch. 2000-192; s. 1, ch. 2001-178; s. 2, ch. 2002-25; s. 7, ch. 2002-55; s. 65, ch. 2002-206; s. 88, ch. 2003-1; s. 2, ch. 2003-139; s. 1028, ch. 2003-261; ss. 4, 65, ch. 2003-267; ss. 58, 80, ch. 2003-281; s. 4, ch. 2004-340; s. 87, ch. 2004-390; s. 1, ch. 2005-41; s. 2, ch. 2006-277; s. 2, ch. 2007-44; s. 8, ch. 2008-66; s. 7, ch. 2008-237; s. 6, ch. 2010-175; s. 1, ch. 2011-167; s. 10, ch. 2012-151; s. 5, ch. 2012-197.
1Note.—Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
626.9543 Holocaust victims.—
(1) SHORT TITLE.—This section may be cited as the “Holocaust Victims Insurance Act.”
(2) INTENT; PURPOSE.—It is the Legislature’s intent that the potential and actual insurance claims of Holocaust victims and their heirs and beneficiaries be expeditiously identified and properly paid and that Holocaust victims and their families receive appropriate assistance in the filing and payment of their rightful claims.
(3) DEFINITIONS.—For the purpose of this section:
(a) “Holocaust victim” means any person who lost his or her life or property as a result of discriminatory laws, policies, or actions targeted against discrete groups of persons between 1920 and 1945, inclusive, in Nazi Germany, areas occupied by Nazi Germany, or countries allied with Nazi Germany.
(b) “Insurance policy” means, but is not limited to, life insurance, property insurance, or education policies.
(c) “Legal relationship” means any parent, subsidiary, or affiliated company with an insurer doing business in this state.
(d) “Proceeds” means the face or other payout value of policies and annuities plus reasonable interest to date of payments without diminution for wartime or immediate postwar currency devaluation.
(4) ASSISTANCE TO HOLOCAUST VICTIMS.—The department shall establish a toll-free telephone number, available in appropriate languages, to assist any person seeking to recover proceeds from an insurance policy issued to a Holocaust victim.
(5) PROOF OF A CLAIM.—Any insurer doing business in this state, in receipt of a claim from a Holocaust victim or from a beneficiary, descendant, or heir of a Holocaust victim, shall:
(a) Diligently and expeditiously investigate all such claims.
(b) Allow such claimants to meet a reasonable, not unduly restrictive, standard of proof to substantiate a claim, pursuant to standards established by the department.
(c) Permit claims irrespective of any statute of limitations or notice requirements imposed by any insurance policy issued, provided the claim is submitted on or before July 1, 2018.
(6) STATUTE OF LIMITATIONS.—Notwithstanding any law or agreement among the parties to an insurance policy to the contrary, any action brought by Holocaust victims or by a beneficiary, heir, or a descendant of a Holocaust victim seeking proceeds of an insurance policy issued or in effect between 1920 and 1945, inclusive, shall not be dismissed for failure to comply with the applicable statute of limitations or laches provided the action is commenced on or before July 1, 2018.
(7) REPORTS FROM INSURERS.—Any insurer doing business in this state shall have an affirmative duty to ascertain to the extent possible and report to the department within 90 days after the effective date of this section and annually thereafter all efforts made and results of such efforts to ascertain:
(a) Any legal relationship with an international insurer that issued an insurance policy to a Holocaust victim between 1920 and 1945, inclusive.
(b) The number and total value of such policies.
(c) Any claim filed by a Holocaust victim, his or her beneficiary, heir, or descendant that has been paid, denied payment, or is pending.
(d) Attempts made by the insurer to locate the beneficiaries of any such policies for which no claim of benefits has been made.
(e) An explanation of any denial or pending payment of a claim to a Holocaust victim, his or her beneficiary, heir, or descendant.
(8) REPORTS TO THE LEGISLATURE.—The department shall report to the Legislature 1 year after the effective date of this section and annually thereafter:
(a) The number of insurers doing business in this state which have a legal relationship with an international insurer that could have issued a policy to a Holocaust victim between 1920 and 1945, inclusive.
(b) A list of all claims paid, denied, or pending to a Holocaust victim, his or her beneficiary, heir, or descendant.
(c) A summary of the length of time for the processing and disposition of a claim by the insurer.
(9) PENALTIES.—In addition to any other penalty provided under this chapter, any insurer or person who violates the provisions of this section is subject to an administrative penalty of $1,000 per day for each day such violation continues.
(10) PRIVATE RIGHT OF ACTION.—An action to recover damages caused by a violation of this section must be commenced within 5 years after the cause of action has accrued. Any person who shall sustain damages by the reason of a violation of this section shall recover threefold the actual damages sustained thereby, as well as costs not exceeding $50,000, and reasonable attorneys’ fees. At or before the commencement of any civil action by a party, notice thereof shall be served upon the department.
(11) RULES.—The department, by rule, shall provide for the implementation of the provisions of this section by establishing procedures and related forms for facilitating, monitoring, and verifying compliance with this section and for the establishment of a restitution program for Holocaust victims, survivors, and their heirs and beneficiaries.
(12) SEVERABILITY.—If any provision of this section or the application thereof to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of the section which can be given effect without the invalid provision or application, and to this end the provisions of this section are declared severable.
History.—s. 9, ch. 98-173; s. 25, ch. 99-3; s. 76, ch. 2004-390; s. 21, ch. 2008-220.
626.9545 Improper charge identification incentive program.—No section or provision of the Florida Insurance Code shall be construed as prohibiting an insurer from establishing a financial incentive program for remunerating a policyholder or an insured person with a selected percentage or stated portion of any health care charge identified by the policyholder or the insured person as an error or overcharge if the health care charge is recovered by the insurer. The financial incentive program shall be written and shall be available for inspection by the office.
History.—ss. 1, 9, ch. 84-235; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1029, ch. 2003-261.
626.9551 Favored agent or insurer; coercion of debtors.—
(1) No person may:
(a) Require, as a condition precedent or condition subsequent to the lending of money or extension of credit or any renewal thereof, that the person to whom such money or credit is extended, or whose obligation the creditor is to acquire or finance, negotiate any policy or contract of insurance through a particular insurer or group of insurers or agent or broker or group of agents or brokers.
(b) Reject an insurance policy solely because the policy has been issued or underwritten by any person who is not associated with a financial institution, or with any subsidiary or affiliate thereof, when such insurance is required in connection with a loan or extension of credit; or unreasonably disapprove the insurance policy provided by a borrower for the protection of the property securing the credit or lien. For purposes of this paragraph, such disapproval shall be deemed unreasonable if it is not based solely on reasonable standards, uniformly applied, relating to the extent of coverage required by such lender or person extending credit and the financial soundness and the services of an insurer. Such standards shall not discriminate against any particular type of insurer, nor shall such standards call for the disapproval of an insurance policy because such policy contains coverage in addition to that required.
(c) Require, directly or indirectly, that any borrower, mortgagor, purchaser, insurer, broker, or agent pay a separate charge in connection with the handling of any insurance policy that is required in connection with a loan or other extension of credit or the provision of another traditional banking product, or pay a separate charge to substitute the insurance policy of one insurer for that of another, unless such charge would be required if the person were providing the insurance. This paragraph does not include the interest which may be charged on premium loans or premium advances in accordance with the security instrument.
(d) Use or provide to others insurance information required to be disclosed by a customer to a financial institution, or a subsidiary or affiliate thereof, in connection with the extension of credit for the purpose of soliciting the sale of insurance, unless the customer has given express written consent or has been given the opportunity to object to such use of the information. Insurance information means information concerning premiums, terms, and conditions of insurance coverage, insurance claims, and insurance history provided by the customer. The opportunity to object to the use of insurance information must be in writing and must be clearly and conspicuously made.
(2)(a) Any person offering the sale of insurance at the time of and in connection with an extension of credit or the sale or lease of goods or services shall disclose in writing that the choice of an insurance provider will not affect the decision regarding the extension of credit or sale or lease of goods or services, except that reasonable requirements may be imposed pursuant to subsection (1).
(b) Federally insured or state-insured depository institutions and credit unions shall make clear and conspicuous disclosure in writing prior to the sale of any insurance policy that such policy is not a deposit, is not insured by the Federal Deposit Insurance Corporation or any other entity, is not guaranteed by the insured depository institution or any person soliciting the purchase of or selling the policy; that the financial institution is not obligated to provide benefits under the insurance contract; and, where appropriate, that the policy involves investment risk, including potential loss of principal.
(c) All documents constituting policies of insurance shall be separate and shall not be combined with or be a part of other documents. A person may not include the expense of insurance premiums in a primary credit transaction without the express written consent of the customer.
(d) A loan officer of a financial institution who is involved in the application, solicitation, or closing of a loan transaction may not solicit or sell insurance in connection with the same loan, but such loan officer may refer the loan customer to another insurance agent who is not involved in the application, solicitation, or closing of the same loan transaction. This paragraph does not apply to an agent located on premises having only a single person with lending authority, or to a broker or dealer registered under the Federal Securities Exchange Act of 1934 in connection with a margin loan secured by securities.
(3) Paragraphs (2)(a), (b), (c), and (d) do not apply to sales of insurance regulated under ss. 627.676-627.6845, s. 655.946, parts XV-XVI of chapter 627, or 12 U.S.C. ss. 4901-4910.
(4) No person may make an extension of credit or the sale of any product or service that is the equivalent to an extension of credit or lease or sale of property of any kind, or furnish any services or fix or vary the consideration for any of the foregoing, on the condition or requirement that the customer obtain insurance from that person, or a subsidiary or affiliate of that person, or a particular insurer, agent, or broker; however, this subsection does not prohibit any person from engaging in any activity that if done by a financial institution would not violate s. 106 of the Bank Holding Company Act Amendments of 1970, 12 U.S.C. s. 1972, as interpreted by the Board of Governors of the Federal Reserve System.
(5) The department or office may investigate the affairs of any person to whom this section applies to determine whether such person has violated this section. If a violation of this section is found to have been committed knowingly, the person in violation shall be subject to the same procedures and penalties as provided in ss. 626.9571, 626.9581, 626.9591, and 626.9601.
History.—s. 9, ch. 76-260; s. 1, ch. 77-174; s. 2, ch. 79-289; s. 236, ch. 79-400; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 2, ch. 99-388; s. 1030, ch. 2003-261.
626.9561 Power of department and office.—The department and office shall each have power within its respective regulatory jurisdiction to examine and investigate the affairs of every person involved in the business of insurance in this state in order to determine whether such person has been or is engaged in any unfair method of competition or in any unfair or deceptive act or practice prohibited by s. 626.9521, and shall each have the powers and duties specified in ss. 626.9571-626.9601 in connection therewith.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1031, ch. 2003-261.
626.9571 Defined practices; hearings, witnesses, appearances, production of books and service of process.—
(1) Whenever the department or office has reason to believe that any person has engaged, or is engaging, in this state in any unfair method of competition or any unfair or deceptive act or practice as defined in s. 626.9541 or s. 626.9551 or is engaging in the business of insurance without being properly licensed as required by this code and that a proceeding by it in respect thereto would be to the interest of the public, it shall conduct or cause to have conducted a hearing in accordance with chapter 120.
(2) The department or office, a duly empowered hearing officer, or an administrative law judge shall, during the conduct of such hearing, have those powers enumerated in s. 120.569; however, the penalties for failure to comply with a subpoena or with an order directing discovery shall be limited to a fine not to exceed $1,000 per violation.
(3) Statements of charges, notices, and orders under this act may be served by anyone duly authorized by the department or office, either in the manner provided by law for service of process in civil actions or by certifying and mailing a copy thereof to the person affected by such statement, notice, order, or other process at his or her or its residence or principal office or place of business. The verified return by the person so serving such statement, notice, order, or other process, setting forth the manner of the service, shall be proof of the same, and the return postcard receipt for such statement, notice, order, or other process, certified and mailed as aforesaid, shall be proof of service of the same.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 270, ch. 96-410; s. 1726, ch. 97-102; s. 1032, ch. 2003-261.
626.9581 Cease and desist and penalty orders.—After the hearing provided in s. 626.9571, the department or office shall enter a final order in accordance with s. 120.569. If it is determined that the person charged has engaged in an unfair or deceptive act or practice or the unlawful transaction of insurance, the department or office shall also issue an order requiring the violator to cease and desist from engaging in such method of competition, act, or practice or the unlawful transaction of insurance. Further, if the act or practice is a violation of s. 626.9541 or s. 626.9551, the department or office may, at its discretion, order any one or more of the following:
(1) Suspension or revocation of the person’s certificate of authority, license, or eligibility for any certificate of authority or license, if he or she knew, or reasonably should have known, he or she was in violation of this act.
(2) Such other relief as may be provided in the insurance code.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 271, ch. 96-410; s. 1727, ch. 97-102; s. 1033, ch. 2003-261.
626.9591 Appeals from the department or office.—Any person subject to an order of the department or office under s. 626.9581 or s. 626.9601 may obtain a review of such order by filing an appeal therefrom in accordance with the provisions and procedures for appeal from the orders of the department or office in general under s. 120.68.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; s. 45, ch. 83-215; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1034, ch. 2003-261.
626.9601 Penalty for violation of cease and desist orders.—Any person who violates a cease and desist order of the department or office under s. 626.9581 while such order is in effect, after notice and hearing as provided in s. 626.9571, shall be subject, at the discretion of the department or office, to any one or more of the following:
(1) A monetary penalty of not more than $50,000 as to all matters determined in such hearing.
(2) Suspension or revocation of such person’s certificate of authority, license, or eligibility to hold such certificate of authority or license.
(3) Such other relief as may be provided in the insurance code.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1035, ch. 2003-261.
626.9611 Rules.—
(1) The department or commission may, in accordance with chapter 120, adopt reasonable rules as are necessary or proper to identify specific methods of competition or acts or practices which are prohibited by s. 626.9541 or s. 626.9551, but the rules shall not enlarge upon or extend the provisions of ss. 626.9541 and 626.9551.
(2) The department and the commission shall, in accordance with chapter 120, adopt rules to protect members of the United States Armed Forces from dishonest or predatory insurance sales practices by insurers and insurance agents. The rules shall identify specific false, misleading, deceptive, or unfair methods of competition, acts, or practices which are prohibited by s. 626.9541 or s. 626.9551. The rules shall be based upon model rules or model laws adopted by the National Association of Insurance Commissioners which identify certain insurance practices involving the solicitation or sale of insurance and annuities to members of the United States Armed Forces which are false, misleading, deceptive, or unfair.
History.—s. 9, ch. 76-260; s. 1, ch. 77-174; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1036, ch. 2003-261; s. 10, ch. 2007-199.
626.9621 Provisions of part additional to existing law.—The powers vested in the department, commission, and office by this part shall be additional to any other powers to enforce any penalties, fines, or forfeitures authorized by law.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1037, ch. 2003-261.
626.9631 Civil liability.—The provisions of this part are cumulative to rights under the general civil and common law, and no action of the department, commission, or office shall abrogate such rights to damages or other relief in any court.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1038, ch. 2003-261.
626.9641 Policyholders, bill of rights.—
(1) The principles expressed in the following statements shall serve as standards to be followed by the department, commission, and office in exercising their powers and duties, in exercising administrative discretion, in dispensing administrative interpretations of the law, and in adopting rules:
(a) Policyholders shall have the right to competitive pricing practices and marketing methods that enable them to determine the best value among comparable policies.
(b) Policyholders shall have the right to obtain comprehensive coverage.
(c) Policyholders shall have the right to insurance advertising and other selling approaches that provide accurate and balanced information on the benefits and limitations of a policy.
(d) Policyholders shall have a right to an insurance company that is financially stable.
(e) Policyholders shall have the right to be serviced by a competent, honest insurance agent or broker.
(f) Policyholders shall have the right to a readable policy.
(g) Policyholders shall have the right to an insurance company that provides an economic delivery of coverage and that tries to prevent losses.
(h) Policyholders shall have the right to a balanced and positive regulation by the department, commission, and office.
(2) This section shall not be construed as creating a civil cause of action by any individual policyholder against any individual insurer.
History.—s. 9, ch. 76-260; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 1039, ch. 2003-261.
626.9651 Privacy.—The department and commission shall each adopt rules consistent with other provisions of the Florida Insurance Code to govern the use of a consumer’s nonpublic personal financial and health information. These rules must be based on, consistent with, and not more restrictive than the Privacy of Consumer Financial and Health Information Regulation, adopted September 26, 2000, by the National Association of Insurance Commissioners; however, the rules must permit the use and disclosure of nonpublic personal health information for scientific, medical, or public policy research, in accordance with federal law. In addition, these rules must be consistent with, and not more restrictive than, the standards contained in Title V of the Gramm-Leach-Bliley Act of 1999, Pub. L. No. 106-102. If the office determines that a health insurer or health maintenance organization is in compliance with, or is actively undertaking compliance with, the consumer privacy protection rules adopted by the United States Department of Health and Human Services, in conformance with the Health Insurance Portability and Affordability Act, that health insurer or health maintenance organization is in compliance with this section.
History.—s. 25, ch. 2001-142; s. 12, ch. 2001-222; s. 143, ch. 2001-277; s. 1040, ch. 2003-261.
626.9701 Rate increases and premium surcharges; consideration of certain noncriminal violations for excessive speed prohibited.—Noncriminal violations solely for excessive speed less than 70 miles per hour on highways which are outside business and residential districts and which have at least four lanes divided by a median strip at least 20 feet wide and on highways which comprise a part of the national system of interstate and defense highways shall not be considered by insurance companies in rate increases for individuals or surcharges for insurance premiums.
History.—s. 5, ch. 76-218; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.9702 Illegal dealings in premiums; excess charges for insurance.—
(1) No insurer shall impose or request an additional premium for automobile insurance, or refuse to renew a policy, solely because the insured or applicant was convicted of one or more traffic violations which do not involve an accident or do not cause revocation or suspension of the driving privileges of the insured, without adequate proof of a direct, demonstrable, objective relationship between the violation for which the surcharge was imposed and the increased risk of highway accidents.
(2) No insurer shall cancel or otherwise terminate any automobile insurance contract with an insured after the insured has paid the premiums on such policy for 5 years or more solely because the insured is involved in a single traffic accident.
(3) Any person or organization which violates any provision of this section shall be subject to the penalties provided in s. 627.381.
History.—s. 1, ch. 77-158; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.9705 Life or disability insurance; illegal dealings.—
(1) No life or disability insurer shall refuse to renew, sell, or issue a life or disability insurance policy, establish or charge a premium or rate to an applicant or a prospective policyholder, or establish or charge an unfair, discriminatory premium or rate to such person solely on the ground that the applicant or policyholder suffers from a severe disability.
(2) “Severe disability,” as used in this section, means any spinal cord disease or injury resulting in permanent and total disability, amputation of any extremity that requires prosthesis, permanent visual acuity of 20/200 or worse in the better eye with the best correction, a peripheral field so contracted that the widest diameter of such field subtends an angular distance no greater than 20 degrees, or neurosensory deafness.
(3) Nothing in this section should be construed as requiring an insurer to provide insurance coverage against a severe disability which the applicant or policyholder has already sustained.
History.—ss. 1, 7, ch. 75-279; s. 1, ch. 77-174; s. 1, ch. 79-171; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.9706 Life insurance; discrimination on basis of sickle-cell trait prohibited.—
(1) No insurer authorized to transact insurance in this state shall refuse to issue and deliver any policy of life insurance solely because the person to be insured has the sickle-cell trait.
(2) No life insurance policy issued and delivered in this state shall carry a higher premium rate or charge solely because the person to be insured has the sickle-cell trait.
History.—s. 1, ch. 78-35; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.9707 Disability insurance; discrimination on basis of sickle-cell trait prohibited.—
(1) No insurer authorized to transact insurance in this state shall refuse to issue and deliver in this state any policy of disability insurance, whether such policy is defined as individual, group, blanket, franchise, industrial, or otherwise, which is currently being issued for delivery in this state and which affords benefits and coverage for any medical treatment or service authorized and permitted to be furnished by a hospital, clinic, health clinic, neighborhood health clinic, health maintenance organization, physician, physician’s assistant, nurse practitioner, or medical service facility or personnel solely because the person to be insured has the sickle-cell trait.
(2) No disability insurance policy issued or delivered in this state shall carry a higher premium rate or charge solely because the person to be insured has the sickle-cell trait.
History.—s. 1, ch. 78-35; s. 807, ch. 82-243; ss. 206, 207, ch. 90-363; s. 4, ch. 91-429.
626.973 Fictitious groups.—
(1) No insurer or any person on behalf of any insurer shall make, offer to make, or permit any preference or distinction in property, marine, casualty, or surety insurance as to form of policy, certificate, premium, rate, benefits, or conditions of insurance, based upon membership, nonmembership, or employment of any person or persons by or in any particular group, association, corporation, or organization, and shall not make the foregoing preference or distinction available in any event based upon any “fictitious grouping” of persons as defined in this code, such “fictitious grouping” being hereby defined and declared to be any grouping by way of membership, nonmembership, license, franchise, employment, contract, agreement, or any other method or means.
(2) The restrictions and limitations of this section do not extend to life insurance, health insurance, and medical malpractice insurance.
(3) The restrictions and limitations of this section do not extend to property or casualty insurance issued in this state, provided that:
(a) The policy requires active participation in a plan of risk management which has established measures and procedures to minimize both the frequency and severity of losses;
(b) The policy passes on the benefits of reduced losses to plan participants;
(c) Rates are actuarially measurable and credible and are sufficiently related to actual and expected loss and expense experience of the group so as to assure that nonmembers of the group are not unfairly discriminated against; and
(d) For any personal lines insurance risk, the group is composed of such members and meets the requirements specified in s. 627.552 for employee groups, s. 627.553 for debtor groups, s. 627.554 for labor union groups, s. 627.555 for trustee groups, s. 627.556 for credit union groups, s. 627.5567 for association groups, and s. 627.654 for labor union and association groups; except that any provision of such sections which precludes individual selection of amounts of insurance shall not be applicable to property or casualty insurance.
History.—s. 398, ch. 59-205; s. 807, ch. 82-243; s. 91, ch. 83-216; s. 22, ch. 85-175; s. 6, ch. 86-160; s. 81, ch. 89-360; ss. 187, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 26, ch. 99-3.
626.9741 Use of credit reports and credit scores by insurers.—
(1) The purpose of this section is to regulate and limit the use of credit reports and credit scores by insurers for underwriting and rating purposes. This section applies only to personal lines motor vehicle insurance and personal lines residential insurance, which includes homeowners, mobile home owners’ dwelling, tenants, condominium unit owners, cooperative unit owners, and similar types of insurance.
(2) As used in this section, the term:
(a) “Adverse decision” means a decision to refuse to issue or renew a policy of insurance; to issue a policy with exclusions or restrictions; to increase the rates or premium charged for a policy of insurance; to place an insured or applicant in a rating tier that does not have the lowest available rates for which that insured or applicant is otherwise eligible; or to place an applicant or insured with a company operating under common management, control, or ownership which does not offer the lowest rates available, within the affiliate group of insurance companies, for which that insured or applicant is otherwise eligible.
(b) “Credit report” means any written, oral, or other communication of any information by a consumer reporting agency, as defined in the federal Fair Credit Reporting Act, 15 U.S.C. ss. 1681 et seq., bearing on a consumer’s credit worthiness, credit standing, or credit capacity, which is used or expected to be used or collected as a factor to establish a person’s eligibility for credit or insurance, or any other purpose authorized pursuant to the applicable provision of such federal act. A credit score alone, as calculated by a credit reporting agency or by or for the insurer, may not be considered a credit report.
(c) “Credit score” means a score, grade, or value that is derived by using any or all data from a credit report in any type of model, method, or program, whether electronically, in an algorithm, computer software or program, or any other process, for the purpose of grading or ranking credit report data.
(d) “Tier” means a category within a single insurer into which insureds with substantially similar risk, exposure, or expense factors are placed for purposes of determining rate or premium.
(3) An insurer must inform an applicant or insured, in the same medium as the application is taken, that a credit report or score is being requested for underwriting or rating purposes. An insurer that makes an adverse decision based, in whole or in part, upon a credit report must provide at no charge, a copy of the credit report to the applicant or insured or provide the applicant or insured with the name, address, and telephone number of the consumer reporting agency from which the insured or applicant may obtain the credit report. The insurer must provide notification to the consumer explaining the reasons for the adverse decision. The reasons must be provided in sufficiently clear and specific language so that a person can identify the basis for the insurer’s adverse decision. Such notification shall include a description of the four primary reasons, or such fewer number as existed, which were the primary influences of the adverse decision. The use of generalized terms such as “poor credit history,” “poor credit rating,” or “poor insurance score” does not meet the explanation requirements of this subsection. A credit score may not be used in underwriting or rating insurance unless the scoring process produces information in sufficient detail to permit compliance with the requirements of this subsection. It shall not be deemed an adverse decision if, due to the insured’s credit report or credit score, the insured continues to receive a less favorable rate or placement in a less favorable tier or company at the time of renewal except for renewals or reunderwriting required by this section.
(4)(a) An insurer may not request a credit report or score based upon the race, color, religion, marital status, age, gender, income, national origin, or place of residence of the applicant or insured.
(b) An insurer may not make an adverse decision solely because of information contained in a credit report or score without consideration of any other underwriting or rating factor.
(c) An insurer may not make an adverse decision or use a credit score that could lead to such a decision if based, in whole or in part, on:
1. The absence of, or an insufficient, credit history, in which instance the insurer shall:
a. Treat the consumer as otherwise approved by the Office of Insurance Regulation if the insurer presents information that such an absence or inability is related to the risk for the insurer;
b. Treat the consumer as if the applicant or insured had neutral credit information, as defined by the insurer;
c. Exclude the use of credit information as a factor and use only other underwriting criteria;
2. Collection accounts with a medical industry code, if so identified on the consumer’s credit report;
3. Place of residence; or
4. Any other circumstance that the Financial Services Commission determines, by rule, lacks sufficient statistical correlation and actuarial justification as a predictor of insurance risk.
(d) An insurer may use the number of credit inquiries requested or made regarding the applicant or insured except for:
1. Credit inquiries not initiated by the consumer or inquiries requested by the consumer for his or her own credit information.
2. Inquiries relating to insurance coverage, if so identified on a consumer’s credit report.
3. Collection accounts with a medical industry code, if so identified on the consumer’s credit report.
4. Multiple lender inquiries, if coded by the consumer reporting agency on the consumer’s credit report as being from the home mortgage industry and made within 30 days of one another, unless only one inquiry is considered.
5. Multiple lender inquiries, if coded by the consumer reporting agency on the consumer’s credit report as being from the automobile lending industry and made within 30 days of one another, unless only one inquiry is considered.
(e) An insurer must, upon the request of an applicant or insured, provide a means of appeal for an applicant or insured whose credit report or credit score is unduly influenced by a dissolution of marriage, the death of a spouse, or temporary loss of employment. The insurer must complete its review within 10 business days after the request by the applicant or insured and receipt of reasonable documentation requested by the insurer, and, if the insurer determines that the credit report or credit score was unduly influenced by any of such factors, the insurer shall treat the applicant or insured as if the applicant or insured had neutral credit information or shall exclude the credit information, as defined by the insurer, whichever is more favorable to the applicant or insured. An insurer shall not be considered out of compliance with its underwriting rules or rates or forms filed with the Office of Insurance Regulation or out of compliance with any other state law or rule as a result of granting any exceptions pursuant to this subsection.
(5) A rate filing that uses credit reports or credit scores must comply with the requirements of s. 627.062 or s. 627.0651 to ensure that rates are not excessive, inadequate, or unfairly discriminatory.
(6) An insurer that requests or uses credit reports and credit scoring in its underwriting and rating methods shall maintain and adhere to established written procedures that reflect the restrictions set forth in the federal Fair Credit Reporting Act, this section, and all rules related thereto.
(7)(a) An insurer shall establish procedures to review the credit history of an insured who was adversely affected by the use of the insured’s credit history at the initial rating of the policy, or at a subsequent renewal thereof. This review must be performed at a minimum of once every 2 years or at the request of the insured, whichever is sooner, and the insurer shall adjust the premium of the insured to reflect any improvement in the credit history. The procedures must provide that, with respect to existing policyholders, the review of a credit report will not be used by the insurer to cancel, refuse to renew, or require a change in the method of payment or payment plan.
(b) However, as an alternative to the requirements of paragraph (a), an insurer that used a credit report or credit score for an insured upon inception of a policy, who will not use a credit report or score for reunderwriting, shall reevaluate the insured within the first 3 years after inception, based on other allowable underwriting or rating factors, excluding credit information if the insurer does not increase the rates or premium charged to the insured based on the exclusion of credit reports or credit scores.
(8) The commission may adopt rules to administer this section. The rules may include, but need not be limited to:
(a) Information that must be included in filings to demonstrate compliance with subsection (3).
(b) Statistical detail that insurers using credit reports or scores under subsection (5) must retain and report annually to the Office of Insurance Regulation.
(c) Standards that ensure that rates or premiums associated with the use of a credit report or score are not unfairly discriminatory, based upon race, color, religion, marital status, age, gender, income, national origin, or place of residence.
(d) Standards for review of models, methods, programs, or any other process by which to grade or rank credit report data and which may produce credit scores in order to ensure that the insurer demonstrates that such grading, ranking, or scoring is valid in predicting insurance risk of an applicant or insured.
History.—s. 3, ch. 2003-407.
626.9743 Claim settlement practices relating to motor vehicle insurance.—
(1) This section shall apply to the adjustment and settlement of personal and commercial motor vehicle insurance claims.
(2) An insurer may not, when liability and damages owed under the policy are reasonably clear, recommend that a third-party claimant make a claim under his or her own policy solely to avoid paying the claim under the policy issued by that insurer. However, the insurer may identify options to a third-party claimant relative to the repair of his or her vehicle.
(3) An insurer that elects to repair a motor vehicle and specifically requires a particular repair shop for vehicle repairs shall cause the damaged vehicle to be restored to its physical condition as to performance and appearance immediately prior to the loss at no additional cost to the insured or third-party claimant other than as stated in the policy.
(4) An insurer may not require the use of replacement parts in the repair of a motor vehicle which are not at least equivalent in kind and quality to the damaged parts prior to the loss in terms of fit, appearance, and performance.
(5) When the insurance policy provides for the adjustment and settlement of first-party motor vehicle total losses on the basis of actual cash value or replacement with another of like kind and quality, the insurer shall use one of the following methods:
(a) The insurer may elect a cash settlement based upon the actual cost to purchase a comparable motor vehicle, including sales tax, if applicable pursuant to subsection (9). Such cost may be derived from:
1. When comparable motor vehicles are available in the local market area, the cost of two or more such comparable motor vehicles available within the preceding 90 days;
2. The retail cost as determined from a generally recognized used motor vehicle industry source such as:
a. An electronic database if the pertinent portions of the valuation documents generated by the database are provided by the insurer to the first-party insured upon request; or
b. A guidebook that is generally available to the general public if the insurer identifies the guidebook used as the basis for the retail cost to the first-party insured upon request; or
3. The retail cost using two or more quotations obtained by the insurer from two or more licensed dealers in the local market area.
(b) The insurer may elect to offer a replacement motor vehicle that is a specified comparable motor vehicle available to the insured, including sales tax if applicable pursuant to subsection (9), paid for by the insurer at no cost other than any deductible provided in the policy and betterment as provided in subsection (6). The offer must be documented in the insurer’s claim file. For purposes of this subsection, a comparable motor vehicle is one that is made by the same manufacturer, of the same or newer model year, and of similar body type and that has similar options and mileage as the insured vehicle. Additionally, a comparable motor vehicle must be in as good or better overall condition than the insured vehicle and available for inspection within a reasonable distance of the insured’s residence.
(c) When a motor vehicle total loss is adjusted or settled on a basis that varies from the methods described in paragraph (a) or paragraph (b), the determination of value must be supported by documentation, and any deductions from value must be itemized and specified in appropriate dollar amounts. The basis for such settlement shall be explained to the claimant in writing, if requested, and a copy of the explanation shall be retained in the insurer’s claim file.
(d) Any other method agreed to by the claimant.
(6) When the amount offered in settlement reflects a reduction by the insurer because of betterment or depreciation, information pertaining to the reduction shall be maintained with the insurer’s claim file. Deductions shall be itemized and specific as to dollar amount and shall accurately reflect the value assigned to the betterment or depreciation. The basis for any deduction shall be explained to the claimant in writing, if requested, and a copy of the explanation shall be maintained with the insurer’s claim file.
(7) Every insurer shall, if partial losses are settled on the basis of a written estimate prepared by or for the insurer, supply the insured a copy of the estimate upon which the settlement is based.
(8) Every insurer shall provide notice to an insured before termination of payment for previously authorized storage charges, and the notice shall provide 72 hours for the insured to remove the vehicle from storage before terminating payment of the storage charges.
(9) If sales tax will necessarily be incurred by a claimant upon replacement of a total loss or upon repair of a partial loss, the insurer may defer payment of the sales tax unless and until the obligation has actually been incurred.
(10) Nothing in this section shall be construed to authorize or preclude enforcement of policy provisions relating to settlement disputes.
History.—s. 9, ch. 2004-370; s. 154, ch. 2004-390.
626.9744 Claim settlement practices relating to property insurance.—Unless otherwise provided by the policy, when a homeowner’s insurance policy provides for the adjustment and settlement of first-party losses based on repair or replacement cost, the following requirements apply:
(1) When a loss requires repair or replacement of an item or part, any physical damage incurred in making such repair or replacement which is covered and not otherwise excluded by the policy shall be included in the loss to the extent of any applicable limits. The insured may not be required to pay for betterment required by ordinance or code except for the applicable deductible, unless specifically excluded or limited by the policy.
(2) When a loss requires replacement of items and the replaced items do not match in quality, color, or size, the insurer shall make reasonable repairs or replacement of items in adjoining areas. In determining the extent of the repairs or replacement of items in adjoining areas, the insurer may consider the cost of repairing or replacing the undamaged portions of the property, the degree of uniformity that can be achieved without such cost, the remaining useful life of the undamaged portion, and other relevant factors.
(3) This section shall not be construed to make the insurer a warrantor of the repairs made pursuant to this section.
(4) Nothing in this section shall be construed to authorize or preclude enforcement of policy provisions relating to settlement disputes.
History.—s. 10, ch. 2004-370; s. 155, ch. 2004-390.
626.9885 Financial institutions conducting insurance transactions.—A financial institution, as defined in s. 655.005, may conduct insurance transactions only through Florida-licensed insurance agents representing Florida-authorized insurers or representing Florida-eligible surplus lines insurers.
History.—s. 4, ch. 99-388; s. 43, ch. 2011-194.
626.989 Investigation by department or Division of Insurance Fraud; compliance; immunity; confidential information; reports to division; division investigator’s power of arrest.—
(1) For the purposes of this section:
(a) A person commits a “fraudulent insurance act” if the person:
1. Knowingly and with intent to defraud presents, causes to be presented, or prepares with knowledge or belief that it will be presented, to or by an insurer, self-insurer, self-insurance fund, servicing corporation, purported insurer, broker, or any agent thereof, any written statement as part of, or in support of, an application for the issuance of, or the rating of, any insurance policy, or a claim for payment or other benefit pursuant to any insurance policy, which the person knows to contain materially false information concerning any fact material thereto or if the person conceals, for the purpose of misleading another, information concerning any fact material thereto.
2. Knowingly submits:
a. A false, misleading, or fraudulent application or other document when applying for licensure as a health care clinic, seeking an exemption from licensure as a health care clinic, or demonstrating compliance with part X of chapter 400 with an intent to use the license, exemption from licensure, or demonstration of compliance to provide services or seek reimbursement under the Florida Motor Vehicle No-Fault Law.
b. A claim for payment or other benefit pursuant to a personal injury protection insurance policy under the Florida Motor Vehicle No-Fault Law if the person knows that the payee knowingly submitted a false, misleading, or fraudulent application or other document when applying for licensure as a health care clinic, seeking an exemption from licensure as a health care clinic, or demonstrating compliance with part X of chapter 400.
(b) The term “insurer” also includes a health maintenance organization, and the term “insurance policy” also includes a health maintenance organization subscriber contract.
(2) If, by its own inquiries or as a result of complaints, the department or its Division of Insurance Fraud has reason to believe that a person has engaged in, or is engaging in, a fraudulent insurance act, an act or practice that violates s. 626.9541 or s. 817.234, or an act or practice punishable under s. 624.15, it may administer oaths and affirmations, request the attendance of witnesses or proffering of matter, and collect evidence. The department shall not compel the attendance of any person or matter in any such investigation except pursuant to subsection (4).
(3) If matter that the department or its division seeks to obtain by request is located outside the state, the person so requested may make it available to the division or its representative to examine the matter at the place where it is located. The division may designate representatives, including officials of the state in which the matter is located, to inspect the matter on its behalf, and it may respond to similar requests from officials of other states.
(4)(a) The department or its division may request that an individual who refuses to comply with any such request be ordered by the circuit court to provide the testimony or matter. The court shall not order such compliance unless the department or its division has demonstrated to the satisfaction of the court that the testimony of the witness or the matter under request has a direct bearing on the commission of a fraudulent insurance act, on a violation of s. 626.9541 or s. 817.234, or on an act or practice punishable under s. 624.15 or is pertinent and necessary to further such investigation.
(b) Except in a prosecution for perjury, an individual who complies with a court order to provide testimony or matter after asserting a privilege against self-incrimination to which the individual is entitled by law may not be subjected to a criminal proceeding or to a civil penalty with respect to the act concerning which the individual is required to testify or produce relevant matter.
(c) In the absence of fraud or bad faith, a person is not subject to civil liability for libel, slander, or any other relevant tort by virtue of filing reports, without malice, or furnishing other information, without malice, required by this section or required by the department or division under the authority granted in this section, and no civil cause of action of any nature shall arise against such person:
1. For any information relating to suspected fraudulent insurance acts or persons suspected of engaging in such acts furnished to or received from law enforcement officials, their agents, or employees;
2. For any information relating to suspected fraudulent insurance acts or persons suspected of engaging in such acts furnished to or received from other persons subject to the provisions of this chapter;
3. For any such information furnished in reports to the department, the division, the National Insurance Crime Bureau, the National Association of Insurance Commissioners, or any local, state, or federal enforcement officials or their agents or employees; or
4. For other actions taken in cooperation with any of the agencies or individuals specified in this paragraph in the lawful investigation of suspected fraudulent insurance acts.
(d) In addition to the immunity granted in paragraph (c), persons identified as designated employees whose responsibilities include the investigation and disposition of claims relating to suspected fraudulent insurance acts may share information relating to persons suspected of committing fraudulent insurance acts with other designated employees employed by the same or other insurers whose responsibilities include the investigation and disposition of claims relating to fraudulent insurance acts, provided the department has been given written notice of the names and job titles of such designated employees prior to such designated employees sharing information. Unless the designated employees of the insurer act in bad faith or in reckless disregard for the rights of any insured, neither the insurer nor its designated employees are civilly liable for libel, slander, or any other relevant tort, and a civil action does not arise against the insurer or its designated employees:
1. For any information related to suspected fraudulent insurance acts provided to an insurer; or
2. For any information relating to suspected fraudulent insurance acts provided to the National Insurance Crime Bureau or the National Association of Insurance Commissioners.
Provided, however, that the qualified immunity against civil liability conferred on any insurer or its designated employees shall be forfeited with respect to the exchange or publication of any defamatory information with third persons not expressly authorized by this paragraph to share in such information.
(e) The Chief Financial Officer and any employee or agent of the department, commission, office, or division, when acting without malice and in the absence of fraud or bad faith, is not subject to civil liability for libel, slander, or any other relevant tort, and no civil cause of action of any nature exists against such person by virtue of the execution of official activities or duties of the department, commission, or office under this section or by virtue of the publication of any report or bulletin related to the official activities or duties of the department, division, commission, or office under this section.
(f) This section does not abrogate or modify in any way any common-law or statutory privilege or immunity heretofore enjoyed by any person.
(5) The office’s and the department’s papers, documents, reports, or evidence relative to the subject of an investigation under this section are confidential and exempt from the provisions of s. 119.07(1) until such investigation is completed or ceases to be active. For purposes of this subsection, an investigation is considered “active” while the investigation is being conducted by the office or department with a reasonable, good faith belief that it could lead to the filing of administrative, civil, or criminal proceedings. An investigation does not cease to be active if the office or department is proceeding with reasonable dispatch and has a good faith belief that action could be initiated by the office or department or other administrative or law enforcement agency. After an investigation is completed or ceases to be active, portions of records relating to the investigation shall remain exempt from the provisions of s. 119.07(1) if disclosure would:
(a) Jeopardize the integrity of another active investigation;
(b) Impair the safety and soundness of an insurer;
(c) Reveal personal financial information;
(d) Reveal the identity of a confidential source;
(e) Defame or cause unwarranted damage to the good name or reputation of an individual or jeopardize the safety of an individual; or
(f) Reveal investigative techniques or procedures. Further, such papers, documents, reports, or evidence relative to the subject of an investigation under this section shall not be subject to discovery until the investigation is completed or ceases to be active. Office, department, or division investigators shall not be subject to subpoena in civil actions by any court of this state to testify concerning any matter of which they have knowledge pursuant to a pending insurance fraud investigation by the division.
(6) Any person, other than an insurer, agent, or other person licensed under the code, or an employee thereof, having knowledge or who believes that a fraudulent insurance act or any other act or practice which, upon conviction, constitutes a felony or a misdemeanor under the code, or under s. 817.234, is being or has been committed may send to the Division of Insurance Fraud a report or information pertinent to such knowledge or belief and such additional information relative thereto as the department may request. Any professional practitioner licensed or regulated by the Department of Business and Professional Regulation, except as otherwise provided by law, any medical review committee as defined in s. 766.101, any private medical review committee, and any insurer, agent, or other person licensed under the code, or an employee thereof, having knowledge or who believes that a fraudulent insurance act or any other act or practice which, upon conviction, constitutes a felony or a misdemeanor under the code, or under s. 817.234, is being or has been committed shall send to the Division of Insurance Fraud a report or information pertinent to such knowledge or belief and such additional information relative thereto as the department may require. The Division of Insurance Fraud shall review such information or reports and select such information or reports as, in its judgment, may require further investigation. It shall then cause an independent examination of the facts surrounding such information or report to be made to determine the extent, if any, to which a fraudulent insurance act or any other act or practice which, upon conviction, constitutes a felony or a misdemeanor under the code, or under s. 817.234, is being committed. The Division of Insurance Fraud shall report any alleged violations of law which its investigations disclose to the appropriate licensing agency and state attorney or other prosecuting agency having jurisdiction with respect to any such violation, as provided in s. 624.310. If prosecution by the state attorney or other prosecuting agency having jurisdiction with respect to such violation is not begun within 60 days of the division’s report, the state attorney or other prosecuting agency having jurisdiction with respect to such violation shall inform the division of the reasons for the lack of prosecution.
(7) Division investigators shall have the power to make arrests for criminal violations established as a result of investigations. Such investigators shall also be considered state law enforcement officers for all purposes and shall have the power to execute arrest warrants and search warrants; to serve subpoenas issued for the examination, investigation, and trial of all offenses; and to arrest upon probable cause without warrant any person found in the act of violating any of the provisions of applicable laws. Investigators empowered to make arrests under this section shall be empowered to bear arms in the performance of their duties. In such a situation, the investigator must be certified in compliance with the provisions of s. 943.1395 or must meet the temporary employment or appointment exemption requirements of s. 943.131 until certified.
(8) It is unlawful for any person to resist an arrest authorized by this section or in any manner to interfere, either by abetting or assisting such resistance or otherwise interfering, with division investigators in the duties imposed upon them by law or department rule.
(9) In recognition of the complementary roles of investigating instances of workers’ compensation fraud and enforcing compliance with the workers’ compensation coverage requirements under chapter 440, the Department of Financial Services shall prepare and submit a joint performance report to the President of the Senate and the Speaker of the House of Representatives by November 1, 2003, and then by January 1 of each year. The annual report must include, but need not be limited to:
(a) The total number of initial referrals received, cases opened, cases presented for prosecution, cases closed, and convictions resulting from cases presented for prosecution by the Bureau of Workers’ Compensation Insurance Fraud by type of workers’ compensation fraud and circuit.
(b) The number of referrals received from insurers and the Division of Workers’ Compensation and the outcome of those referrals.
(c) The number of investigations undertaken by the Bureau of Workers’ Compensation Insurance Fraud which were not the result of a referral from an insurer or the Division of Workers’ Compensation.
(d) The number of investigations that resulted in a referral to a regulatory agency and the disposition of those referrals.
(e) The number and reasons provided by local prosecutors or the statewide prosecutor for declining prosecution of a case presented by the Bureau of Workers’ Compensation Insurance Fraud by circuit.
(f) The total number of employees assigned to the Bureau of Workers’ Compensation Insurance Fraud and the Division of Workers’ Compensation Bureau of Compliance delineated by location of staff assigned; and the number and location of employees assigned to the Bureau of Workers’ Compensation Insurance Fraud who were assigned to work other types of fraud cases.
(g) The average caseload and turnaround time by type of case for each investigator and division compliance employee.
(h) The training provided during the year to workers’ compensation fraud investigators and the division’s compliance employees.
History.—s. 9, ch. 76-266; s. 211, ch. 77-104; s. 20, ch. 77-468; s. 2, ch. 78-258; s. 2, ch. 79-81; s. 237, ch. 79-400; s. 3, ch. 81-48; ss. 807, 810, ch. 82-243; s. 92, ch. 83-216; s. 30, ch. 83-288; s. 1, ch. 87-334; s. 1, ch. 89-42; ss. 189, 206, 207, ch. 90-363; s. 4, ch. 91-429; s. 11, ch. 92-324; s. 10, ch. 93-80; s. 8, ch. 93-252; s. 224, ch. 94-218; s. 5, ch. 95-340; s. 378, ch. 96-406; s. 1729, ch. 97-102; s. 15, ch. 98-174; s. 2, ch. 99-204; s. 4, ch. 2001-271; s. 87, ch. 2001-277; s. 66, ch. 2002-194; s. 5, ch. 2003-148; s. 1041, ch. 2003-261; s. 43, ch. 2003-412; s. 77, ch. 2004-390; s. 4, ch. 2012-197.
626.9891 Insurer anti-fraud investigative units; reporting requirements; penalties for noncompliance.—
(1) Every insurer admitted to do business in this state who in the previous calendar year, at any time during that year, had $10 million or more in direct premiums written shall:
(a) Establish and maintain a unit or division within the company to investigate possible fraudulent claims by insureds or by persons making claims for services or repairs against policies held by insureds; or
(b) Contract with others to investigate possible fraudulent claims for services or repairs against policies held by insureds.
An insurer subject to this subsection shall file with the Division of Insurance Fraud of the department on or before July 1, 1996, a detailed description of the unit or division established pursuant to paragraph (a) or a copy of the contract and related documents required by paragraph (b).
(2) Every insurer admitted to do business in this state, which in the previous calendar year had less than $10 million in direct premiums written, must adopt an anti-fraud plan and file it with the Division of Insurance Fraud of the department on or before July 1, 1996. An insurer may, in lieu of adopting and filing an anti-fraud plan, comply with the provisions of subsection (1).
(3) Each insurers anti-fraud plans shall include:
(a) A description of the insurer’s procedures for detecting and investigating possible fraudulent insurance acts;
(b) A description of the insurer’s procedures for the mandatory reporting of possible fraudulent insurance acts to the Division of Insurance Fraud of the department;
(c) A description of the insurer’s plan for anti-fraud education and training of its claims adjusters or other personnel; and
(d) A written description or chart outlining the organizational arrangement of the insurer’s anti-fraud personnel who are responsible for the investigation and reporting of possible fraudulent insurance acts.
(4) Any insurer who obtains a certificate of authority after July 1, 1995, shall have 18 months in which to comply with the requirements of this section.
(5) For purposes of this section, the term “unit or division” includes the assignment of fraud investigation to employees whose principal responsibilities are the investigation and disposition of claims. If an insurer creates a distinct unit or division, hires additional employees, or contracts with another entity to fulfill the requirements of this section, the additional cost incurred must be included as an administrative expense for ratemaking purposes.
(6) Each insurer writing workers’ compensation insurance shall report to the department, on or before August 1 of each year, on its experience in implementing and maintaining an anti-fraud investigative unit or an anti-fraud plan. The report must include, at a minimum:
(a) The dollar amount of recoveries and losses attributable to workers’ compensation fraud delineated by the type of fraud: claimant, employer, provider, agent, or other.
(b) The number of referrals to the Bureau of Workers’ Compensation Fraud for the prior year.
(c) A description of the organization of the anti-fraud investigative unit, if applicable, including the position titles and descriptions of staffing.
(d) The rationale for the level of staffing and resources being provided for the anti-fraud investigative unit, which may include objective criteria such as number of policies written, number of claims received on an annual basis, volume of suspected fraudulent claims currently being detected, other factors, and an assessment of optimal caseload that can be handled by an investigator on an annual basis.
(e) The inservice education and training provided to underwriting and claims personnel to assist in identifying and evaluating instances of suspected fraudulent activity in underwriting or claims activities.
(f) A description of a public awareness program focused on the costs and frequency of insurance fraud and methods by which the public can prevent it.
(7) If an insurer fails to timely submit a final acceptable anti-fraud plan or anti-fraud investigative unit description, fails to implement the provisions of a plan or an anti-fraud investigative unit description, or otherwise refuses to comply with the provisions of this section, the department, office, or commission may:
(a) Impose an administrative fine of not more than $2,000 per day for such failure by an insurer to submit an acceptable anti-fraud plan or anti-fraud investigative unit description, until the department, office, or commission deems the insurer to be in compliance;
(b) Impose an administrative fine for failure by an insurer to implement or follow the provisions of an anti-fraud plan or anti-fraud investigative unit description; or
(c) Impose the provisions of both paragraphs (a) and (b).
(8) The department may adopt rules to administer this section.
History.—s. 6, ch. 95-340; s. 44, ch. 2003-412; s. 10, ch. 2006-305.
626.9892 Anti-Fraud Reward Program; reporting of insurance fraud.—
(1) The Anti-Fraud Reward Program is hereby established within the department, to be funded from the Insurance Regulatory Trust Fund.
(2) The department may pay rewards of up to $25,000 to persons providing information leading to the arrest and conviction of persons committing crimes investigated by the Division of Insurance Fraud arising from violations of s. 440.105, s. 624.15, s. 626.9541, s. 626.989, or s. 817.234.
(3) Only a single reward amount may be paid by the department for claims arising out of the same transaction or occurrence, regardless of the number of persons arrested and convicted and the number of persons submitting claims for the reward. The reward may be disbursed among more than one person in amounts determined by the department.
(4) The department shall adopt rules which set forth the application and approval process, including the criteria against which claims shall be evaluated, the basis for determining specific reward amounts, and the manner in which rewards shall be disbursed. Applications for rewards authorized by this section must be made pursuant to rules established by the department.
(5) Determinations by the department to grant or deny a reward under this section shall not be considered agency action subject to review under s. 120.569 or s. 120.57.
History.—s. 3, ch. 99-204; s. 19, ch. 2002-236; s. 1042, ch. 2003-261.
626.9893 Disposition of revenues; criminal or forfeiture proceedings.—
(1) The Division of Insurance Fraud of the Department of Financial Services may deposit revenues received as a result of criminal proceedings or forfeiture proceedings, other than revenues deposited into the Department of Financial Services’ Federal Law Enforcement Trust Fund under s. 17.43, into the Insurance Regulatory Trust Fund. Moneys deposited pursuant to this section shall be separately accounted for and shall be used solely for the division to carry out its duties and responsibilities.
(2) Moneys deposited into the Insurance Regulatory Trust Fund pursuant to this section shall be appropriated by the Legislature, pursuant to the provisions of chapter 216, for the sole purpose of enabling the division to carry out its duties and responsibilities.
(3) Notwithstanding the provisions of s. 216.301 and pursuant to s. 216.351, any balance of moneys deposited into the Insurance Regulatory Trust Fund pursuant to this section remaining at the end of any fiscal year shall remain in the trust fund at the end of that year and shall be available for carrying out the duties and responsibilities of the division.
History.—s. 11, ch. 2006-305; s. 6, ch. 2007-14.
626.9894 Gifts and grants.—
(1) The department may accept, for purposes of anti-fraud efforts, any donation or grant of property or moneys from any governmental unit, public agency, institution, person, firm, or corporation.
(2) All rights to, interest in, and title to such donated or granted property shall immediately vest in the Division of Insurance Fraud upon donation. The division may hold such property in coownership, sell its interest in the property, liquidate its interest in the property, or dispose of its interest in the property in any other reasonable manner.
(3) All donations or grants of moneys to the division shall be deposited into the Insurance Regulatory Trust Fund and shall be separately accounted for and may be used by the division to carry out its duties and responsibilities, or for the subgranting of such funds to state attorneys for the purpose of funding or defraying the costs of dedicated fraud prosecutors.
(4) Moneys deposited into the Insurance Regulatory Trust Fund pursuant to this section may be appropriated by the Legislature, pursuant to the provisions of chapter 216, for the purpose of enabling the division to carry out its duties and responsibilities, or for the purpose of funding or defraying the costs of dedicated fraud prosecutors.
(5) Notwithstanding s. 216.301 and pursuant to s. 216.351, any balance of moneys deposited into the Insurance Regulatory Trust Fund pursuant to this section or s. 626.9895 remaining at the end of any fiscal year is available for carrying out the duties and responsibilities of the division. The department may request annual appropriations from the grants and donations received pursuant to this section or s. 626.9895 and cash balances in the Insurance Regulatory Trust Fund for the purpose of carrying out its duties and responsibilities related to the division’s anti-fraud efforts, including the funding of dedicated prosecutors and related personnel.
History.—s. 9, ch. 2011-59; s. 6, ch. 2012-197.
626.9895 Motor vehicle insurance fraud direct-support organization.—
(1) DEFINITIONS.—As used in this section, the term:
(a) “Division” means the Division of Insurance Fraud of the Department of Financial Services.
(b) “Motor vehicle insurance fraud” means any act defined as a “fraudulent insurance act” under s. 626.989, which relates to the coverage of motor vehicle insurance as described in part XI of chapter 627.
(c) “Organization” means the direct-support organization established under this section.
(2) ORGANIZATION ESTABLISHED.—The division may establish a direct-support organization, to be known as the “Automobile Insurance Fraud Strike Force,” whose sole purpose is to support the prosecution, investigation, and prevention of motor vehicle insurance fraud. The organization shall:
(a) Be a not-for-profit corporation incorporated under chapter 617 and approved by the Department of State.
(b) Be organized and operated to conduct programs and activities; raise funds; request and receive grants, gifts, and bequests of money; acquire, receive, hold, invest, and administer, in its own name, securities, funds, objects of value, or other property, real or personal; and make grants and expenditures to or for the direct or indirect benefit of the division, state attorneys’ offices, the statewide prosecutor, the Agency for Health Care Administration, and the Department of Health to the extent that such grants and expenditures are used exclusively to advance the prosecution, investigation, or prevention of motor vehicle insurance fraud. Grants and expenditures may include the cost of salaries or benefits of motor vehicle insurance fraud investigators, prosecutors, or support personnel if such grants and expenditures do not interfere with prosecutorial independence or otherwise create conflicts of interest which threaten the success of prosecutions.
(c) Be determined by the division to operate in a manner that promotes the goals of laws relating to motor vehicle insurance fraud, that is in the best interest of the state, and that is in accordance with the adopted goals and mission of the division.
(d) Use all of its grants and expenditures solely for the purpose of preventing and decreasing motor vehicle insurance fraud, and not for advertising using the likeness or name of any elected official nor for the purpose of lobbying as defined in s. 11.045.
(e) Be subject to an annual financial audit in accordance with s. 215.981.
(3) CONTRACT.—The organization shall operate under written contract with the division. The contract must provide for:
(a) Approval of the articles of incorporation and bylaws of the organization by the division.
(b) Submission of an annual budget for approval of the division. The budget must require the organization to minimize costs to the division and its members at all times by using existing personnel and property and allowing for telephonic meetings if appropriate.
(c) Certification by the division that the organization is complying with the terms of the contract and in a manner consistent with the goals and purposes of the department and in the best interest of the state. Such certification must be made annually and reported in the official minutes of a meeting of the organization.
(d) Allocation of funds to address motor vehicle insurance fraud.
(e) Reversion of moneys and property held in trust by the organization for motor vehicle insurance fraud prosecution, investigation, and prevention to the division if the organization is no longer approved to operate for the department or if the organization ceases to exist, or to the state if the division ceases to exist.
(f) Specific criteria to be used by the organization’s board of directors to evaluate the effectiveness of funding used to combat motor vehicle insurance fraud.
(g) The fiscal year of the organization, which begins July 1 of each year and ends June 30 of the following year.
(h) Disclosure of the material provisions of the contract, and distinguishing between the department and the organization to donors of gifts, contributions, or bequests, including providing such disclosure on all promotional and fundraising publications.
(4) BOARD OF DIRECTORS.—
(a) The board of directors of the organization shall consist of the following 11 members:
1. The Chief Financial Officer, or designee, who shall serve as chair.
2. Two state attorneys, one of whom shall be appointed by the Chief Financial Officer and one of whom shall be appointed by the Attorney General.
3. Two representatives of motor vehicle insurers appointed by the Chief Financial Officer.
4. Two representatives of local law enforcement agencies, one of whom shall be appointed by the Chief Financial Officer and one of whom shall be appointed by the Attorney General.
5. Two representatives of the types of health care providers who regularly make claims for benefits under ss. 627.730-627.7405, one of whom shall be appointed by the President of the Senate and one of whom shall be appointed by the Speaker of the House of Representatives. The appointees may not represent the same type of health care provider.
6. A private attorney 1who has experience in representing claimants in actions for benefits under ss. 627.730-627.7405, who shall be appointed by the President of the Senate.
7. A private attorney who has experience in representing insurers in actions for benefits under ss. 627.730-627.7405, who shall be appointed by the Speaker of the House of Representatives.
(b) The officer who appointed a member of the board may remove that member for any reason. The term of office of an appointed member expires at the same time as the term of the officer who appointed him or her or at such earlier time as the person ceases to be qualified.
(5) USE OF PROPERTY.—The department may authorize, without charge, appropriate use of fixed property and facilities of the division by the organization, subject to this subsection.
(a) The department may prescribe any condition with which the organization must comply in order to use the division’s property or facilities.
(b) The department may not authorize the use of the division’s property or facilities if the organization does not provide equal membership and employment opportunities to all persons regardless of race, religion, sex, age, or national origin.
(c) The department shall adopt rules prescribing the procedures by which the organization is governed and any conditions with which the organization must comply to use the division’s property or facilities.
(6) CONTRIBUTIONS FROM INSURERS.—Contributions from an insurer to the organization shall be allowed as an appropriate business expense of the insurer for all regulatory purposes.
(7) DEPOSITORY ACCOUNT.—Any moneys received by the organization may be held in a separate depository account in the name of the organization and subject to the contract with the division.
(8) DIVISION’S RECEIPT OF PROCEEDS.—Proceeds received by the division from the organization shall be deposited into the Insurance Regulatory Trust Fund.
History.—s. 7, ch. 2012-197.
626.99 Life insurance solicitation.—
(1) PURPOSE.—The purpose of this section is to require insurers to deliver to purchasers of life insurance information which will improve the buyer’s ability to select the most appropriate plan of life insurance for his or her needs, improve the buyer’s understanding of the basic features of the policy which has been purchased or which is under consideration, and improve the ability of the buyer to evaluate the relative costs of similar plans of life insurance. This section does not prohibit an insurer from using additional material which is not in violation of this chapter or any other statute or regulation.
(2) SCOPE; EXEMPTIONS.—
(a) Except as hereafter exempted, this section shall apply to any solicitation, negotiation, or procurement of life insurance occurring within this state. This section shall apply to any issuer of life insurance contracts, including a fraternal benefit society.
(b) Unless they are otherwise specifically included, this section shall not apply to:
1. Annuities.
2. Credit life insurance.
3. Group life insurance.
4. Life insurance policies issued in connection with pension and welfare plans as defined by and which are subject to the federal Employee Retirement Income Security Act of 1974 (ERISA).
5. Variable life insurance under which the death benefits and cash values vary in accordance with unit values of investments held in a separate account.
(3) DEFINITIONS AND FORMULAS.—As used in this section:
(a) “Buyer’s guide” means a document which shall contain all the requirements of, and which is in substantial compliance with, subsection (6).
(b) “Cash dividend” means the current illustrated dividend which can be applied toward payment of the gross premium.
(c) “Equivalent level annual dividend” is calculated by applying the following steps:
1. Accumulate the annual cash dividends at 5 percent interest compounded annually to the end of the 10th and the end of the 20th policy years.
2. Divide each accumulation of step 1. under this paragraph by an interest factor that converts it into one, equivalent level annual amount that, if paid at the beginning of each year, would accrue to the values in step 1. under this paragraph over the respective periods stipulated in step 1. under this paragraph. If the period is 10 years, the factor is 13.207; and if the period is 20 years, the factor is 34.719.
3. Divide the results of step 2. under this paragraph by the number of thousands of the equivalent level death benefits to arrive at the equivalent level annual dividend.
(d) “Equivalent level death benefit” of a policy or term life insurance rider is an amount calculated by applying the following steps:
1. Accumulate the guaranteed amount payable upon death, regardless of the cause of death, at the beginning of each policy year for 10 and 20 years at 5 percent interest compounded annually to the end of the 10th and 20th policy years respectively.
2. Divide each accumulation of step 1. under this paragraph by an interest factor that converts it into one, equivalent level annual amount that, if paid at the beginning of each year, would accrue to the value in step 1. of this paragraph over the respective periods stipulated in step 1. under this paragraph. If the period is 10 years, the factor is 13.207; and if the period is 20 years, the factor is 34.719.
(e) “Generic name” means a short title which is descriptive of the premium and benefit patterns of a policy or a rider.
(f) “Life insurance surrender cost index” is calculated by applying the following steps:
1. Determine the guaranteed cash surrender value, if any, available at the end of the 10th and the end of the 20th policy years.
2. For participating policies, add the terminal dividend payable upon surrender, if any, to the accumulation of the annual cash dividends at 5 percent interest compounded annually to the end of the period selected and add this sum to the amount determined in step 1. under this paragraph.
3. Divide the result of step 2. under this paragraph (step 1. for guaranteed-cost policies) by an interest factor that converts it into an equivalent level annual amount that, if paid at the beginning of each year, would accrue to the value in step 2. under this paragraph (step 1. for guaranteed-cost policies) over the respective periods stipulated in step 1. If the period is 10 years, the factor is 13.207; and if the period is 20 years, the factor is 34.719.
4. Determine the equivalent level premium by accumulating each annual premium payable for the basic policy or rider at 5 percent interest compounded annually to the end of the period stipulated in step 1. under this paragraph and dividing the result by the respective factors stated in step 3. under this paragraph (this amount is the annual premium payable for a level premium plan).
5. Subtract the result of step 3. from step 4.
6. Divide the result of step 5. by the number of thousands of the equivalent level death benefit to arrive at the life insurance surrender cost index.
(g) “Life insurance net payment cost index” is calculated in the same manner as the comparable life insurance cost index, except that the cash surrender value and any terminal dividend are set at zero.
(h) “Policy summary” means a written statement describing the elements of the policy, including, but not limited to, the following:
1. A prominently placed title as follows: STATEMENT OF POLICY COST AND BENEFIT INFORMATION;
2. The name and address of the insurance agent or, if no agent is involved, a statement of the procedure to be followed in order to receive responses to inquiries regarding the policy summary;
3. The full name and home office or administrative office address of the company in which the life insurance policy is to be or has been written;
4. The generic name of the basic policy and of each rider;
5. The following amounts, when applicable, for the first 5 policy years and representative policy years thereafter, sufficient to clearly illustrate the premium and benefit patterns, including, but not necessarily limited to, the years for which life insurance cost indexes are displayed and at least one age from 60 through 65, or maturity of the policy, whichever is earlier:
a. The annual premium for the basic policy;
b. The annual premium for each optional rider;
c. The guaranteed amount payable upon death, at the beginning of the policy year regardless of the cause of death other than suicide, or other specifically enumerated exclusions, which is provided by the basic policy and each optional rider, with benefits provided under the basic policy and each rider shown separately;
d. The total guaranteed cash surrender values at the end of the year, with values shown separately for the basic policy and each rider;
e. The cash dividends payable at the end of the year, with values shown separately for the basic policy and each rider (dividends need not be displayed beyond the 20th policy year); and
f. The guaranteed endowment amounts payable under the policy which are not included under guaranteed cash surrender values above;
6. The effective policy loan annual percentage interest rate, if the policy contains this provision, specifying whether this rate is applied in advance or in arrears. If the policy loan interest rate is variable, the policy summary shall include the maximum annual percentage rate;
7. Life insurance cost indexes for 10 and 20 years, but in no case beyond the premium-paying period. Separate indexes must be displayed for the basic policy and for each optional term life insurance rider. Such indexes need not be included for optional riders which are limited to benefits such as accidental death benefits, disability waiver of premium, preliminary term life insurance coverage of less than 12 months, and guaranteed insurability benefits, nor need they be included for the basic policies or optional riders covering more than one life;
8. The equivalent level annual dividend, in the case of participating policies and participating optional term life insurance riders, under the same circumstances and for the same durations at which life insurance cost indexes are displayed;
9. For a policy summary which includes dividends, a statement that dividends are based on the company’s current dividend scale and are not guaranteed, in addition to a statement in close proximity to the equivalent level annual dividend as follows: “An explanation of the intended use of the equivalent level annual dividend is included in the life insurance buyer’s guide”;
10. A statement in close proximity to the life insurance cost indexes as follows: “An explanation of the intended use of these indexes is provided in the life insurance buyer’s guide”; and
11. The date on which the policy summary is prepared. The policy summary must consist of a separate document. All information required to be disclosed must be set out in such a manner as not to minimize the effect of any portion thereof or to render any portion thereof obscure. Any amounts which remain level for 2 or more years of the policy may be represented by a single number if it is clearly indicated what amounts are applicable for each policy year. Amounts in subparagraph 5. shall be listed in total, not on a per-thousand or per-unit basis. If more than one insured is covered under one policy or rider, guaranteed death benefits shall be displayed separately for each insured or for each class of insureds, if death benefits do not differ within the class. Zero amounts shall be displayed as zero and shall not be displayed as a blank space.
(4) DISCLOSURE REQUIREMENTS.—
1(a) The insurer shall provide to each prospective purchaser a buyer’s guide and a policy summary prior to accepting the applicant’s initial premium or premium deposit, unless the policy for which application is made provides an unconditional refund for a period of at least 14 days, or unless the policy summary contains an offer of such an unconditional refund. In these instances, the buyer’s guide and policy summary must be delivered with the policy or prior to delivery of the policy.
1(b) With respect to fixed and variable annuities, the policy must provide an unconditional refund for a period of at least 14 days. For fixed annuities, the buyer’s guide shall be in the form as provided by the National Association of Insurance Commissioners (NAIC) Annuity Disclosure Model Regulation, until such time as a buyer’s guide is developed by the department, at which time the department guide must be used. For variable annuities, a policy summary may be used, which may be contained in a prospectus, until such time as a buyer’s guide is developed by NAIC or the department, at which time one of those guides must be used. If the prospective owner of an annuity contract is 65 years of age or older:
1. An unconditional refund of premiums paid for a fixed annuity contract, including any contract fees or charges, must be available for a period of 21 days; and
2. An unconditional refund for variable or market value annuity contracts must be available for a period of 21 days. The unconditional refund shall be equal to the cash surrender value provided in the annuity contract, plus any fees or charges deducted from the premiums or imposed under the contract. This subparagraph does not apply if the prospective owner is an accredited investor, as defined in Regulation D as adopted by the United States Securities and Exchange Commission.
(c) The insurer shall attach a cover page to any annuity policy informing the purchaser of the unconditional refund period prescribed in paragraph (b). The cover page must also provide contact information for the issuing company and the selling agent, the department’s toll-free help line, and any other information required by the department by rule. The cover page is part of the policy and is subject to review by the office pursuant to s. 627.410.
(d) The insurer shall provide a buyer’s guide and a policy summary to any prospective purchaser upon request.
(5) GENERAL RULES RELATING TO SOLICITATION.—
(a) Each insurer subject to this section shall maintain at its home office or principal office a complete file containing one copy of each document authorized by the insurer for use pursuant to this section. Such file shall contain one copy of each authorized form for a period of 3 years following the date of its last authorized use.
(b) An agent shall inform the prospective purchaser, prior to commencing a life insurance sales presentation, that he or she is acting as a life insurance agent and shall inform the prospective purchaser of the full name of the insurance company which the agent is representing. In sales situations in which an agent is not involved, the insurer shall identify its full name.
(c) Terms such as “financial planner,” “investment adviser,” “financial consultant,” or “financial counseling” shall not be used in such a way as to imply that the insurance agent is generally engaged in an advisory business in which compensation is unrelated to sales unless such is actually the case.
(d) Any reference to policy dividends must include a statement that dividends are not guaranteed.
(e) A system or presentation which does not recognize the time value of money through the use of appropriate interest adjustments shall not be used for comparing the cost of two or more life insurance policies. Such a system may be used for the purpose of demonstrating the cash-flow pattern of a policy if such presentation is accompanied by a statement disclosing that the presentation does not recognize that, because of interest, a dollar in the future has less value than a dollar today.
(f) A presentation of benefits shall not display guaranteed and nonguaranteed benefits as a single sum unless they are shown separately in close proximity thereto.
(g) A statement regarding the use of the life insurance cost indexes shall include an explanation to the effect that the indexes are useful only for the comparison of the relative costs of two or more similar policies.
(h) A life insurance cost index which reflects dividends or an equivalent level annual dividend shall be accompanied by a statement that it is based on the insurer’s current dividend scale and is not guaranteed.
(i) For the purposes of this section, the annual premium for a basic policy or rider, for which the insurer reserves the right to change the premium, shall be the maximum annual premium.
(j) If a replacement policy is proposed by any insurer to a prospective purchaser which would be issued in any rating class other than the most favorable rating class for a person of the same age and gender as the prospective purchaser, the replacing insurer shall provide to the prospective purchaser any disclosure and rate comparison required by law in insurance replacement transactions.
(k) If an appropriately licensed agent proposes to replace a life insurance policy or an in-force annuity with a registered securities product, preapplication notice requirements shall not apply.
(6) ADOPTION OF BUYER’S GUIDE; REQUIREMENTS.—Any insurer soliciting life insurance in this state on or after October 1, 1980, shall adopt and use a buyer’s guide, and the adoption and use by an insurer of the buyer’s guide adopted October 1, 1996, by the National Association of Insurance Commissioners in the NAIC Life Insurance Disclosure Model Regulation shall be in compliance with the requirements of this section.
(7) FAILURE TO COMPLY.—The failure of an insurer to provide or deliver a buyer’s guide or a policy summary as provided in subsection (4) shall constitute an omission which misrepresents the benefits, advantages, conditions, or terms of an insurance policy within the meaning of this part.
History.—s. 1, ch. 80-156; s. 423, ch. 81-259; s. 807, ch. 82-243; ss. 190, 206, 207, ch. 90-363; s. 3, ch. 91-296; s. 4, ch. 91-429; s. 9, ch. 96-377; s. 1730, ch. 97-102; s. 3, ch. 2000-365; s. 1043, ch. 2003-261; s. 8, ch. 2008-237; s. 51, ch. 2010-175.
1Note.—Section 12, ch. 2008-237, provides in part that “[e]ffective [June 30, 2008,] the Department of Financial Services may adopt rules to implement this act.”
PART X
VIATICAL SETTLEMENTS626.991 Short title.
626.9911 Definitions.
626.9912 Viatical settlement provider license required; application for license.
626.9913 Viatical settlement provider license continuance; annual report; fees; deposit.
626.9914 Suspension, revocation, denial, or nonrenewal of viatical settlement provider license; grounds; administrative fine.
626.9915 Effect of suspension or revocation of viatical settlement provider license; duration of suspension; reinstatement.
626.9916 Viatical settlement broker license required.
626.99175 Life expectancy providers; registration required; denial, suspension, revocation.
626.99181 Viatical settlement broker’s compensation.
626.9919 Notice of change of licensee or registrant’s address or name.
626.992 Use of licensed viatical settlement providers, viatical settlement brokers, and registered life expectancy providers required.
626.9921 Filing of forms; required procedures; approval.
626.9922 Examination.
626.9923 Viatical settlement contracts; required disclosures.
626.9924 Viatical settlement contracts; procedures; rescission.
626.99245 Conflict of regulation of viaticals.
626.9925 Rules.
626.9926 Rate regulation not authorized.
626.9927 Unfair trade practices; cease and desist; injunctions; civil remedy.
626.99272 Cease and desist orders and fines.
626.99275 Prohibited practices; penalties.
626.99278 Viatical provider anti-fraud plan.
626.9928 Acquisitions.
626.99285 Applicability of insurance code.
626.99287 Contestability of viaticated policies.
626.99295 Grace period.
626.991 Short title.—This act may be referred to as the “Viatical Settlement Act.”
History.—s. 1, ch. 96-336.
626.9911 Definitions.—As used in this act, the term:
(1) “Financing entity” means an underwriter, placement agent, lender, purchaser of securities, or purchaser of a policy or certificate from a viatical settlement provider, credit enhancer, or any entity that has direct ownership in a policy or certificate that is the subject of a viatical settlement contract, but whose principal activity related to the transaction is providing funds or credit enhancement to effect the viatical settlement or the purchase of one or more viaticated policies and who has an agreement in writing with one or more licensed viatical settlement providers to finance the acquisition of viatical settlement contracts. The term does not include a nonaccredited investor or other natural person. A financing entity may not enter into a viatical settlement contract.
(2) “Independent third-party trustee or escrow agent” means an attorney, certified public accountant, financial institution, or other person providing escrow services under the authority of a regulatory body. The term does not include any person associated, affiliated, or under common control with a viatical settlement provider or viatical settlement broker.
(3) “Life expectancy” means an opinion or evaluation as to how long a particular person is to live, or relating to such person’s expected demise.
(4) “Life expectancy provider” means a person who determines, or holds himself or herself out as determining, life expectancies or mortality ratings used to determine life expectancies:
(a) On behalf of a viatical settlement provider, viatical settlement broker, life agent, or person engaged in the business of viatical settlements;
(b) In connection with a viatical settlement investment, pursuant to s. 517.021(23); or
(c) On residents of this state in connection with a viatical settlement contract or viatical settlement investment.
(5) “Person” has the meaning specified in s. 1.01.
(6) “Related form” means any form, created by or on behalf of a licensee, which a viator is required to sign or initial. The forms include, but are not limited to, a power of attorney, a release of medical information form, a suitability questionnaire, a disclosure document, or any addendum, schedule, or amendment to a viatical settlement contract considered necessary by a provider to effectuate a viatical settlement transaction.
(7) “Related provider trust” means a titling trust or other trust established by a licensed viatical settlement provider or financing entity for the sole purpose of holding the ownership or beneficial interest in purchased policies in connection with a financing transaction. The trust must have a written agreement with a licensed viatical settlement provider or financing entity under which the licensed viatical settlement provider or financing entity is responsible for insuring compliance with all statutory and regulatory requirements and under which the trust agrees to make all records and files relating to viatical settlement transactions available to the office as if those records and files were maintained directly by the licensed viatical settlement provider. This term does not include an independent third-party trustee or escrow agent or a trust that does not enter into agreements with a viator. A related provider trust shall be subject to all provisions of this act that apply to the viatical settlement provider who established the related provider trust, except s. 626.9912, which shall not be applicable. A viatical settlement provider may establish no more than one related provider trust, and the sole trustee of such related provider trust shall be the viatical settlement provider licensed under s. 626.9912. The name of the licensed viatical settlement provider shall be included within the name of the related provider trust.
(8) “Special purpose entity” means an entity established by a licensed viatical settlement provider or by a financing entity, which may be a corporation, partnership, trust, limited liability company, or other similar entity formed solely to provide, either directly or indirectly, access to institutional capital markets to a viatical settlement provider or financing entity. A special purpose entity may not obtain capital from any natural person or entity with less than $50 million in assets and may not enter into a viatical settlement contract.
(9) “Viatical settlement broker” means a person who, on behalf of a viator and for a fee, commission, or other valuable consideration, offers or attempts to negotiate viatical settlement contracts between a viator resident in this state and one or more viatical settlement providers. Notwithstanding the manner in which the viatical settlement broker is compensated, a viatical settlement broker is deemed to represent only the viator and owes a fiduciary duty to the viator to act according to the viator’s instructions and in the best interest of the viator. The term does not include an attorney, licensed Certified Public Accountant, or investment adviser lawfully registered under chapter 517, who is retained to represent the viator and whose compensation is paid directly by or at the direction and on behalf of the viator.
(10) “Viatical settlement contract” means a written agreement entered into between a viatical settlement provider, or its related provider trust, and a viator. The viatical settlement contract includes an agreement to transfer ownership or change the beneficiary designation of a life insurance policy at a later date, regardless of the date that compensation is paid to the viator. The agreement must establish the terms under which the viatical settlement provider will pay compensation or anything of value, which compensation or value is less than the expected death benefit of the insurance policy or certificate, in return for the viator’s assignment, transfer, sale, devise, or bequest of the death benefit or ownership of all or a portion of the insurance policy or certificate of insurance to the viatical settlement provider. A viatical settlement contract also includes a contract for a loan or other financial transaction secured primarily by an individual or group life insurance policy, other than a loan by a life insurance company pursuant to the terms of the life insurance contract, or a loan secured by the cash value of a policy.
(11) “Viatical settlement investment” has the same meaning as specified in s. 517.021.
(12) “Viatical settlement provider” means a person who, in this state, from this state, or with a resident of this state, effectuates a viatical settlement contract. The term does not include:
(a) Any bank, savings bank, savings and loan association, credit union, or other licensed lending institution that takes an assignment of a life insurance policy as collateral for a loan.
(b) A life and health insurer that has lawfully issued a life insurance policy that provides accelerated benefits to terminally ill policyholders or certificateholders.
(c) Any natural person who enters into no more than one viatical settlement contract with a viator in 1 calendar year, unless such natural person has previously been licensed under this act or is currently licensed under this act.
(d) A trust that meets the definition of a “related provider trust.”
(e) A viator in this state.
(f) A financing entity.
(13) “Viaticated policy” means a life insurance policy, or a certificate under a group policy, which is the subject of a viatical settlement contract.
(14) “Viator” means the owner of a life insurance policy or a certificateholder under a group policy, which policy is not a previously viaticated policy, who enters or seeks to enter into a viatical settlement contract. This term does not include a viatical settlement provider or any person acquiring a policy or interest in a policy from a viatical settlement provider, nor does it include an independent third-party trustee or escrow agent.
History.—s. 2, ch. 96-336; s. 22, ch. 97-93; s. 1, ch. 98-164; s. 1, ch. 99-212; s. 1, ch. 2000-344; s. 52, ch. 2001-63; s. 1, ch. 2001-207; s. 1, ch. 2001-247; s. 1044, ch. 2003-261; s. 14, ch. 2005-237; s. 86, ch. 2006-1.
626.9912 Viatical settlement provider license required; application for license.—
(1) A person may not perform the functions of a viatical settlement provider as defined in this act or enter into or solicit a viatical settlement contract without first having obtained a license from the office.
(2) Application for a viatical settlement provider license must be made to the office by the applicant on a form prescribed by the commission, under oath and signed by the applicant. The application must be accompanied by a fee of $500. If the applicant is a corporation, the application must be under oath and signed by the president and the secretary of the corporation.
(3) In the application, the applicant must provide all of the following:
(a) The applicant’s full name, age, residence address, and business address, and all occupations engaged in by the applicant during the 5 years preceding the date of the application.
(b) A copy of the applicant’s basic organizational documents, if any, including the articles of incorporation, articles of association, partnership agreement, trust agreement, or other similar documents, together with all amendments to such documents.
(c) Copies of all bylaws, rules, regulations, or similar documents regulating the conduct of the applicant’s internal affairs.
(d) A list showing the name, business and residence addresses, and official position of each individual who is responsible for conduct of the applicant’s affairs, including, but not limited to, any member of the applicant’s board of directors, board of trustees, executive committee, or other governing board or committee and any other person or entity owning or having the right to acquire 10 percent or more of the voting securities of the applicant.
(e) With respect to each individual identified under paragraph (d):
1. A sworn biographical statement on forms adopted by the commission and supplied by the office.
2. A set of fingerprints on forms prescribed by the commission, certified by a law enforcement officer, and accompanied by the fingerprinting fee specified in s. 624.501.
3. Authority for release of information relating to the investigation of the individual’s background.
(f) All applications, viatical settlement contract forms, escrow forms, and other related forms proposed to be used by the applicant.
(g) A general description of the method the viatical settlement provider will use in determining life expectancies, including a description of the applicant’s intended receipt of life expectancies, the applicant’s intended use of life expectancy providers, and the written plan or plans of policies and procedures used to determine life expectancies.
(h) Such other information as the commission or office deems necessary to determine that the applicant and the individuals identified under paragraph (d) are competent and trustworthy and can lawfully and successfully act as a viatical settlement provider.
(4) The office may not issue a license to an entity other than a natural person if it is not satisfied that all officers, directors, employees, stockholders, partners, and any other persons who exercise or have the ability to exercise effective control of the entity or who have the ability to influence the transaction of business by the entity meet the standards of this act and have not violated any provision of this act or rules of the commission related to the business of viatical settlement contracts.
(5) Upon the filing of a sworn application and the payment of the license fee, the office shall investigate each applicant and may issue the applicant a license if the office finds that the applicant:
(a) Has provided a detailed plan of operation.
(b) Is competent and trustworthy and intends to act in good faith in the business authorized by the license applied for.
(c) Has a good business reputation and has had experience, training, or education that qualifies the applicant to conduct the business authorized by the license applied for.
(d) If the applicant is a corporation, is a corporation incorporated under the laws of this state, or is a foreign corporation authorized to transact business in this state.
(e) Has designated the Chief Financial Officer as its agent for service of process.
(f) Has made the deposit required by s. 626.9913(3).
History.—s. 3, ch. 96-336; s. 2, ch. 2000-344; s. 1045, ch. 2003-261; s. 15, ch. 2005-237; s. 140, ch. 2007-5.
626.9913 Viatical settlement provider license continuance; annual report; fees; deposit.—
(1) A viatical settlement provider license continues in force until suspended or revoked.
(2) Annually, on or before March 1, the viatical settlement provider licensee shall file a statement containing information the commission requires and shall pay to the office a license fee in the amount of $500. After December 31, 2007, the annual statement shall include an annual audited financial statement of the viatical settlement provider prepared in accordance with generally accepted accounting principles by an independent certified public accountant covering a 12-month period ending on a day falling during the last 6 months of the preceding calendar year. If the audited financial statement has not been completed, however, the licensee shall include in its annual statement an unaudited financial statement for the preceding calendar year and an affidavit from an officer of the licensee stating that the audit has not been completed. In this event, the licensee shall submit the audited statement on or before June 1. The annual statement, due on or before March 1 each year, shall also provide the office with a report of all life expectancy providers who have provided life expectancies directly or indirectly to the viatical settlement provider for use in connection with a viatical settlement contract or a viatical settlement investment. A viatical settlement provider shall include in all statements filed with the office all information requested by the office regarding a related provider trust established by the viatical settlement provider. The office may require more frequent reporting. Failure to timely file the annual statement or the audited financial statement or to timely pay the license fee is grounds for immediate suspension of the license. The commission may by rule require all or part of the statements or filings required under this section to be submitted by electronic means in a computer-readable form compatible with the electronic data format specified by the commission.
(3) To ensure the faithful performance of its obligations to its viators in the event of insolvency or the loss of its license, a viatical settlement provider licensee must deposit and maintain deposited in trust with the department securities eligible for deposit under s. 625.52, having at all times a value of not less than $100,000; however, a viatical settlement provider licensed in this state prior to June 1, 2004, which has deposited and maintains continuously deposited in trust with the department securities in the amount of $25,000 and which posted and maintains continuously posted a security bond acceptable to the department in the amount of $75,000, has until June 1, 2005, to comply with the requirements of this subsection.
(4) There shall be no additional annual license fee or deposit requirements under this act for a related provider trust established by a viatical settlement provider.
(5) A judgment creditor or other claimant of a viatical settlement provider does not have the right to levy upon any of the assets or securities held in this state pursuant to this section.
History.—s. 4, ch. 96-336; s. 2, ch. 98-164; s. 1046, ch. 2003-261; s. 16, ch. 2005-237; s. 1, ch. 2006-64; s. 2, ch. 2007-148.
626.9914 Suspension, revocation, denial, or nonrenewal of viatical settlement provider license; grounds; administrative fine.—
(1) The office shall suspend, revoke, deny, or refuse to renew the license of any viatical settlement provider if the office finds that the licensee:
(a) Has made a misrepresentation in the application for the license;
(b) Has engaged in fraudulent or dishonest practices, or otherwise has been shown to be untrustworthy or incompetent to act as a viatical settlement provider;
(c) Demonstrates a pattern of unreasonable payments to viators;
(d) Has been found guilty of, or has pleaded guilty or nolo contendere to, any felony, or a misdemeanor involving fraud or moral turpitude, regardless of whether a judgment of conviction has been entered by the court;
(e) Has issued viatical settlement contracts that have not been approved pursuant to this act;
(f) Has failed to honor contractual obligations related to the business of viatical settlement contracts;
(g) Deals in bad faith with viators;
(h) Has violated any provision of the insurance code or of this act;
(i) Employs any person who materially influences the licensee’s conduct and who fails to meet the requirements of this act;
(j) No longer meets the requirements for initial licensure; or
(k) Obtains or utilizes life expectancies from life expectancy providers who are not registered with the office pursuant to this act.
(2) The office may, in lieu of or in addition to any suspension or revocation, assess an administrative fine not to exceed $2,500 for each nonwillful violation or $10,000 for each willful violation by a viatical settlement provider licensee. The office may also place a viatical settlement provider licensee on probation for a period not to exceed 2 years.
(3) If an employee of a viatical settlement provider violates any provision of this act, the office may take disciplinary action against such employee as if the employee were licensed under this act, including suspending or otherwise prohibiting the employee from performing the functions of a viatical settlement provider or viatical settlement broker as defined in this act.
(4) If a viatical settlement provider establishes a related provider trust as permitted by this act, the viatical settlement provider shall be liable and responsible for the performance of all obligations of the related provider trust under all viatical settlement contracts entered into by the related provider trust, and for the compliance of the related provider trust with all provisions of this act. Any violation of this act by the related provider trust shall be deemed a violation of this act by the viatical settlement provider as well as the related provider trust. If the related provider trust violates any provisions of this act, the office may exercise all remedies set forth in this act for such violations against the viatical settlement provider, as well as the related provider trust.
History.—s. 5, ch. 96-336; s. 3, ch. 98-164; s. 1047, ch. 2003-261; s. 17, ch. 2005-237.
626.9915 Effect of suspension or revocation of viatical settlement provider license; duration of suspension; reinstatement.—
(1) When its license is suspended or revoked, the provider must proceed, immediately following the effective date of the suspension or revocation, to conclude the affairs it is transacting under its license. The provider may not solicit, negotiate, advertise, or effectuate new contracts. The office retains jurisdiction over the provider until all contracts have been fulfilled or canceled or have expired. A provider whose license is suspended or revoked may continue to maintain and service viaticated policies subject to the approval of the office.
(2) The suspension of the license of a viatical settlement provider licensee may be for such period, not to exceed 2 years, as determined by the office. The office may shorten, rescind, or modify the suspension.
(3) During the period of suspension, the licensee shall file its annual statement and pay license fees as if the license had continued in full force.
(4) If, upon expiration of the suspension order, the license has not otherwise been terminated, the office must reinstate the license only upon written request by the suspended licensee unless the office finds that the grounds giving rise to the suspension have not been removed or that the licensee is otherwise not in compliance with the requirements of this act. The office shall give the licensee notice of its findings no later than 90 days after receipt of the request or upon expiration of the suspension order, whichever occurs later. If a license is not reinstated pursuant to the procedures set forth in this subsection, it expires at the end of the suspension or on the date it otherwise would have expired, whichever is sooner.
History.—s. 6, ch. 96-336; s. 14, ch. 2000-344; s. 1048, ch. 2003-261.
626.9916 Viatical settlement broker license required.—
(1) After October 1, 2006, a person, other than a life agent licensed under this chapter, may not in this state, from this state, or with a resident of this state perform the functions of a viatical settlement broker.
(2) Before performing the functions of a viatical settlement broker, a life agent shall appoint himself or herself with the department and pay applicable fees pursuant to s. 624.501(7)(a).
(3) Each natural person who on July 1, 2005, held a viatical settlement broker’s license and self-appointment may, upon obtaining a life agent license on or before October 1, 2006, transfer an existing broker self-appointment to such license.
(4) All viatical settlement broker licenses shall terminate on October 1, 2006, and shall not be subject to continuation or renewal.
(5) Notwithstanding the manner in which the viatical settlement broker is compensated, he or she is deemed to represent only the viator and owes a fiduciary duty to the viator to act according to the viator’s instructions and in the best interest of the viator.
(6) The compensation received by a life agent for activities performed as a viatical settlement broker may not be divided or shared with another person unless such other person is a life agent licensed under this chapter and appointed as provided in this part.
History.—s. 7, ch. 96-336; s. 23, ch. 97-93; s. 1049, ch. 2003-261; s. 66, ch. 2003-267; s. 59, ch. 2003-281; s. 121, ch. 2004-5; s. 18, ch. 2005-237.
626.99175 Life expectancy providers; registration required; denial, suspension, revocation.—
(1) After July 1, 2006, a person may not perform the functions of a life expectancy provider without first having registered as a life expectancy provider, except as provided in subsection (6).
(2) Application for registration as a life expectancy provider must be made to the office by the applicant on a form prescribed by the office, under oath and signed by the applicant. The application must be accompanied by a fee of $500.
(3) A completed application shall be evidenced on a form and in a manner prescribed by the office and shall require the registered life expectancy provider to update such information and renew such registration as required by the office.
(4) In the application, the applicant must provide all of the following:
(a) The full name, age, residence address, and business address, and all occupations engaged in by the applicant during the 5 years preceding the date of the application.
(b) A copy of the applicant’s basic organizational documents, if any, including the articles of incorporation, articles of association, partnership agreement, trust agreement, or other similar documents, together with all amendments to such documents.
(c) Copies of all bylaws, rules, regulations, or similar documents regulating the conduct of the applicant’s internal affairs.
(d) A list showing the name, business and residence addresses, and official position of each individual who is responsible for conduct of the applicant’s affairs, including, but not limited to, any member of the board of directors, board of trustees, executive committee, or other governing board or committee and any other person or entity owning or having the right to acquire 10 percent or more of the voting securities of the applicant, and any person performing life expectancies by the applicant.
(e) A sworn biographical statement on forms supplied by the office with respect to each individual identified under paragraph (d), including whether such individual has been associated with any other life expectancy provider or has performed any services for a person in the business of viatical settlements.
(f) A sworn statement of any criminal and civil actions pending or final against the registrant or any individual identified under paragraph (d).
(g) A general description of the following policies and procedures covering all life expectancy determination criteria and protocols:
1. The plan or plans of policies and procedures used to determine life expectancies.
2. A description of the training, including continuing training, of the individuals who determine life expectancies.
3. A description of how the life expectancy provider updates its manuals, underwriting guides, mortality tables, and other reference works and ensures that the provider bases its determination of life expectancies on current data.
(h) A plan for assuring confidentiality of personal, medical, and financial information in accordance with federal and state laws.
(i) An anti-fraud plan as required pursuant to s. 626.99278.
(j) A list of any agreements, contracts, or any other arrangement to provide life expectancies to a viatical settlement provider, viatical settlement broker, or any other person in the business of viatical settlements in connection with any viatical settlement contract or viatical settlement investment.
(5) As part of the application, and on or before March 1 of every 3 years thereafter, a registered life expectancy provider shall file with the office an audit of all life expectancies by the life expectancy provider for the 5 calendar years immediately preceding such audit, which audit shall be conducted and certified by a nationally recognized actuarial firm and shall include only the following:
(a) A mortality table.
(b) The number, percentage, and an actual-to-expected ratio of life expectancies in the following categories: life expectancies of less than 24 months, life expectancies of 25 months to 48 months, life expectancies of 49 months to 72 months, life expectancies of 73 months to 108 months, life expectancies of 109 months to 144 months, life expectancies of 145 months to 180 months, and life expectancies of more than 180 months.
(6) No viatical settlement broker, viatical settlement provider, or insurance agent in the business of viatical settlements in this state shall directly or indirectly own or be an officer, director, or employee of a life expectancy provider.
(7) Each registered life expectancy provider shall provide the office, as applicable, at least 30 days’ advance notice of any change in the registrant’s name, residence address, principal business address, or mailing address.
(8) A person required to be registered by this section shall for 5 years retain copies of all life expectancies and supporting documents and medical records unless those personal medical records are subject to different retention or destruction requirements of a federal or state personal health information law.
(9) An application for life expectancy provider registration shall be approved or denied by the commissioner within 60 calendar days following receipt of a completed application by the commissioner. The office shall notify the applicant that the application is complete. A completed application that is not approved or denied in 60 calendar days following its receipt shall be deemed approved.
(10) The office may, in its discretion, deny the application for a life expectancy provider registration or suspend, revoke, or refuse to renew or continue the registration of a life expectancy provider if the office finds:
(a) Any cause for which registration could have been refused had it then existed and been known to the office;
(b) A violation of any provision of this code or of any other law applicable to the applicant or registrant;
(c) A violation of any lawful order or rule of the department, commission, or office; or
(d) That the applicant or registrant:
1. Has been found guilty of or pled guilty or nolo contendere to a felony or a crime punishable by imprisonment of 1 year or more under the law of the United States of America or of any state thereof or under the law of any other country;
2. Has knowingly and willfully aided, assisted, procured, advised, or abetted any person in the violation of a provision of the insurance code or any order or rule of the department, commission, or office;
3. Has knowingly and with intent to defraud, provided a life expectancy that does not conform to an applicant’s or registrant’s general practice;
4. Does not have a good business reputation or does not have experience, training, or education that qualifies the applicant or registrant to conduct the business of a life expectancy provider; or
5. Has demonstrated a lack of fitness or trustworthiness to engage in the business of issuing life expectancies.
(11) The office may, in lieu of or in addition to any suspension or revocation, assess an administrative fine not to exceed $2,500 for each nonwillful violation or $10,000 for each willful violation by a registered life expectancy provider. The office may also place a registered life expectancy provider on probation for a period not to exceed 2 years.
(12) It is a violation of this section for a person to represent, orally or in writing, that a life expectancy provider’s registration pursuant to this act is in any way a recommendation or approval of the entity or means that the qualifications or abilities have in any way been approved of.
(13) The Financial Services Commission may, by rule, require that all or part of the statements or filings required under this section be submitted by electronic means and in a computer-readable format specified by the commission.
History.—s. 19, ch. 2005-237; s. 2, ch. 2006-64.
626.99181 Viatical settlement broker’s compensation.—A viatical settlement broker shall disclose to a prospective viator the amount and method of calculating the broker’s compensation. The term “compensation” includes anything of value paid or given to a viatical settlement broker for the placement of a policy.
History.—s. 2, ch. 99-212.
626.9919 Notice of change of licensee or registrant’s address or name.—Each viatical settlement provider licensee and registered life expectancy provider must provide the office at least 30 days’ advance notice of any change in the licensee’s or registrant’s name, residence address, principal business address, or mailing address.
History.—s. 10, ch. 96-336; s. 3, ch. 99-212; s. 1050, ch. 2003-261; s. 20, ch. 2005-237.
626.992 Use of licensed viatical settlement providers, viatical settlement brokers, and registered life expectancy providers required.—
(1) A licensed viatical settlement provider may not use any person to perform the functions of a viatical settlement broker as defined in this act unless such person holds a current, valid life agent license and has appointed himself or herself in conformance with this chapter.
(2) A viatical settlement broker may not use any person to perform the functions of a viatical settlement provider as defined in this act unless such person holds a current, valid license as a viatical settlement provider.
(3) After July 1, 2006, a person may not operate as a life expectancy provider unless such person is registered as a life expectancy provider pursuant to this act.
(4) After July 1, 2006, a viatical settlement provider, viatical settlement broker, or any other person in the business of viatical settlements may not obtain life expectancies from a person who is not registered as a life expectancy provider pursuant to this act.
History.—s. 11, ch. 96-336; s. 4, ch. 99-212; s. 41, ch. 2002-206; s. 21, ch. 2005-237.
626.9921 Filing of forms; required procedures; approval.—
(1) A viatical settlement contract form, escrow form, or related form may be used in this state only after the form has been filed with the office and only after the form has been approved by the office.
(2) The viatical settlement contract form, escrow form, or related form must be filed with the office at least 60 days before its use. The form is considered approved on the 60th day after its date of filing unless it has been previously disapproved by the office. The office must disapprove a viatical settlement contract form, escrow form, or related form that is unreasonable, contrary to the public interest, discriminatory, misleading, or unfair to the viator.
(3) If a viatical settlement provider elects to use a related provider trust in accordance with this act, the viatical settlement provider shall file notice of its intention to use a related provider trust with the office, including a copy of the trust agreement of the related provider trust. The organizational documents of the trust must be submitted to and approved by the office before the transacting of business by the trust.
(4) The commission may adopt, by rule, standardized forms to be used by licensees, at the licensee’s option in place of separately approved forms.
History.—s. 12, ch. 96-336; s. 4, ch. 98-164; s. 3, ch. 2000-344; s. 2, ch. 2001-207; s. 2, ch. 2001-247; s. 1051, ch. 2003-261; s. 22, ch. 2005-237.
626.9922 Examination.—
(1) The office or department may examine the business and affairs of any of its respective licensees or applicants for a license. The office or department may order any such licensee or applicant to produce any records, books, files, advertising and solicitation materials, or other information and may take statements under oath to determine whether the licensee or applicant is in violation of the law or is acting contrary to the public interest. The expenses incurred in conducting any examination or investigation must be paid by the licensee or applicant. Examinations and investigations must be conducted as provided in chapter 624, and licensees are subject to all applicable provisions of the insurance code.
(2) All accounts, books and records, documents, files, contracts, and other information relating to all transactions of viatical settlement contracts, life expectancies, or viatical settlement purchase agreements made before July 1, 2005, must be maintained by the licensee for a period of at least 3 years after the death of the insured and must be available to the office or department for inspection during reasonable business hours.
(3) All such records or accurate copies of such records must be maintained at the licensee’s home office. As used in this section, the term “home office” means the principal place of business and any other single storage facility, the street address of which shall be disclosed to the office or department within 20 days after its initial use, or within 20 days of the effective date of this subsection.
(4) The originals of records required to be maintained under this section must be made available to the office or department for examination at the office’s or department’s request.
(5) The office has jurisdiction over all viatical settlement purchase agreements made before July 1, 2005, including, but not limited to, the authority to examine persons in possession of records relating to viatical settlement purchase agreements made before July 1, 2005, and that authority set forth in s. 624.319.
(6) If the office makes the determination that a viatical settlement provider does not have the financial ability to perform its present or future obligations under the viatical settlement purchase agreements made before July 1, 2005, the office shall make a referral to the United States Securities and Exchange Commission or the Office of Financial Regulation for further administrative action pursuant to s. 517.191, including, but not limited to, the appointment of a receiver by the court.
(7) Subsections (1), (2), (3), and (4) apply to life expectancy providers providing life expectancies in the state and providing life expectancies to viatical settlement providers in the state, as if life expectancy providers were licensees.
History.—s. 13, ch. 96-336; s. 5, ch. 99-212; s. 4, ch. 2000-344; s. 1052, ch. 2003-261; s. 23, ch. 2005-237.
626.9923 Viatical settlement contracts; required disclosures.—The viatical settlement broker, or the viatical settlement provider in transactions in which no broker is used, must inform the viator by the date of application for a viatical settlement contract:
(1) That there are possible alternatives to viatical settlement contracts for persons who have a catastrophic or life-threatening illness, including, but not limited to, accelerated benefits offered by the issuer of a life insurance policy.
(2) That proceeds of the viatical settlement could be taxable, and assistance should be sought from a personal tax advisor.
(3) That viatical settlement proceeds could be subject to the claims of creditors.
(4) That receipt of viatical settlement proceeds could adversely affect the recipient’s eligibility for Medicaid or other government benefits or entitlements, and advice should be obtained from the appropriate agencies.
(5) That all viatical settlement contracts entered into in this state must contain an unconditional rescission provision which allows the viator to rescind the contract within 15 days after the viator receives the viatical settlement proceeds, conditioned on the return of such proceeds.
(6) The name, business address, and telephone number of the independent third-party escrow agent, and the fact that the viator may inspect or receive copies of the relevant escrow or trust agreements or documents.
History.—s. 14, ch. 96-336.
626.9924 Viatical settlement contracts; procedures; rescission.—
(1) A viatical settlement provider entering into a viatical settlement contract with any viator must first obtain a witnessed document in which the viator consents to the viatical settlement contract, represents that he or she has a full and complete understanding of the viatical settlement contract and the benefits of the life insurance policy, releases his or her medical records, and acknowledges that he or she has entered into the viatical settlement contract freely and voluntarily.
(2) All viatical settlement contracts subject to this act must contain an unconditional rescission provision which allows the viator to rescind the contract within 15 days after the viator receives the viatical settlement proceeds, conditioned on the return of such proceeds.
(3) A viatical settlement transaction may be completed only through the use of an independent third-party trustee or escrow agent. Immediately upon receipt by the independent third-party trustee or escrow agent of documents from the viator to effect the transfer of the insurance policy, the viatical settlement provider must pay the proceeds of the settlement to an escrow or trust account managed by the independent third-party trustee or escrow agent in a financial institution licensed under Florida law or a federally chartered financial institution that is a member of the Federal Reserve System, pending acknowledgment of the transfer by the issuer of the policy. An advance or partial payment of the proceeds due under a viatical settlement contract may not be used to effect transfer of the subject policy; any such advance or partial payment is made at the sole discretion and risk of the viatical settlement provider.
(4) Upon receipt of all viatical settlement contract proceeds, the independent third-party trustee or escrow agent must release to the viatical settlement provider all documents necessary to complete the transfer of the insurance policy or certificate of insurance so that the transfer, assignment, sale, bequest, or devise may be effected.
(5) The independent third-party trustee or escrow agent must transfer all proceeds of the viatical settlement contract within 3 business days after receiving from the issuer of the subject policy acknowledgment of the transfer, assignment, bequest, sale, or devise. Failure to transfer proceeds as required by this subsection renders the viatical settlement contract and the transfer, assignment, bequest, sale, or devise voidable.
(6) A viatical settlement provider may not negotiate or enter into a viatical settlement contract with a viator if the subject policy contains an accelerated benefits provision allowing benefits to be paid for a period in advance of the expected death which is equal to or exceeds the time period available under the viatical settlement contract, and at an amount which is equal to or exceeds the amount available under the viatical settlement contract, unless the issuer of the policy, in writing, denies, declines, or refuses to provide such accelerated benefits. If the insurer does not respond to a request to effectuate an accelerated benefits provision sent by certified mail within 30 days after receiving the request, the insurer shall be deemed to have denied, declined, or refused to provide such accelerated benefits.
(7) At any time during the contestable period, within 20 days after a viator executes documents necessary to transfer rights under an insurance policy or within 20 days of any agreement, option, promise, or any other form of understanding, express or implied, to viaticate the policy, the provider must give notice to the insurer of the policy that the policy has or will become a viaticated policy. The notice must be accompanied by the documents required by s. 626.99287(5)(a) in their entirety.
(8) If the owner of the insurance policy is not the insured, the provider shall notify the insured that the policy has become the subject of a viatical settlement contract within 20 days after the transfer of rights under the contract.
(9) If the provider transfers ownership or changes the beneficiary of the insurance policy, the provider must communicate the initial change in ownership or beneficiary to the insured within 20 days after the change.
(10) The viatical settlement provider who effectuated the viatical settlement contract with the viator (the “initial provider”) is responsible for tracking the insured, including, but not limited to, keeping track of the insured’s whereabouts and health status, submission of death claims or assisting the beneficiary in the submission of death claims, and the status of the payment of premiums until the death of the insured. This responsibility may be contracted out to a third party; however, the ultimate responsibility remains with the initial provider. This responsibility continues with the initial provider, notwithstanding any transfers of the viaticated policy in the secondary market. This subsection applies only to those viaticated policies that are or are to become the subject of viatical settlement purchase agreements.
History.—s. 15, ch. 96-336; s. 6, ch. 2000-344; s. 5, ch. 2001-207; s. 5, ch. 2001-247.
626.99245 Conflict of regulation of viaticals.—
(1) A viatical settlement provider who from this state enters into a viatical settlement contract with a viator who is a resident of another state that has enacted statutes or adopted regulations governing viatical settlement contracts shall be governed in the effectuation of that viatical settlement contract by the statutes and regulations of the viator’s state of residence. If the state in which the viator is a resident has not enacted statutes or regulations governing viatical settlement agreements, the provider shall give the viator notice that neither Florida nor his or her state regulates the transaction upon which he or she is entering. For transactions in those states, however, the viatical settlement provider is to maintain all records required as if the transactions were executed in Florida. The forms used in those states need not be approved by the office.
(2) This section does not affect the requirement of ss. 626.9911(12) and 626.9912(1) that a viatical settlement provider doing business from this state must obtain a viatical settlement license from the office. As used in this subsection, the term “doing business from this state” includes effectuating viatical settlement contracts from offices in this state, regardless of the state of residence of the viator.
History.—s. 7, ch. 2000-344; s. 6, ch. 2001-207; s. 6, ch. 2001-247; s. 1054, ch. 2003-261; s. 78, ch. 2004-390; s. 24, ch. 2005-237.
626.9925 Rules.—The commission may adopt rules to administer this act, including rules establishing standards for evaluating advertising by licensees; rules providing for the collection of data, for disclosures to viators, for the reporting of life expectancies, and for the registration of life expectancy providers; and rules defining terms used in this act and prescribing recordkeeping requirements relating to executed viatical settlement contracts.
History.—s. 16, ch. 96-336; s. 7, ch. 99-212; s. 8, ch. 2000-344; s. 1055, ch. 2003-261; s. 25, ch. 2005-237.
626.9926 Rate regulation not authorized.—Nothing in this act shall be construed to authorize the office or department to directly or indirectly regulate the amount paid as consideration for entry into a viatical settlement contract.
History.—s. 17, ch. 96-336; s. 8, ch. 99-212; s. 1056, ch. 2003-261; s. 26, ch. 2005-237.
626.9927 Unfair trade practices; cease and desist; injunctions; civil remedy.—
(1) A violation of this act is an unfair trade practice under ss. 626.9521 and 626.9541 and is subject to the penalties provided in the insurance code. Part IX of this chapter, entitled Unfair Insurance Trade Practices, applies to a licensee under this act or a transaction subject to this act as if a viatical settlement contract were an insurance policy.
(2) In addition to the penalties and other enforcement provisions of this act, if any person violates this act or any rule implementing this act, the office or department, as appropriate, may seek an injunction in the circuit court of the county where the person resides or has a principal place of business and may apply for temporary and permanent orders that the office or department determines necessary to restrain the person from committing the violation.
(3) Any person damaged by the acts of a person in violation of this act may bring a civil action against the person committing the violation in the circuit court of the county in which the alleged violator resides or has a principal place of business or in the county wherein the alleged violation occurred. Upon an adverse adjudication, the defendant is liable for damages, together with court costs and reasonable attorney’s fees incurred by the plaintiff. When so awarded, court costs and attorney’s fees must be included in the judgment or decree rendered in the case. If it appears to the court that the suit brought by the plaintiff is frivolous or brought for purposes of harassment, the plaintiff is liable for court costs and reasonable attorney’s fees incurred by the defendant.
History.—s. 18, ch. 96-336; s. 9, ch. 99-212; s. 1057, ch. 2003-261; s. 27, ch. 2005-237.
626.99272 Cease and desist orders and fines.—
(1) The office or department as appropriate may issue a cease and desist order upon a person that violates any provision of this part, any rule or order adopted by the commission, office, or department, or any written agreement entered into with the office or department.
(2) When the office or department finds that such an action presents an immediate danger to the public which requires an immediate final order, it may issue an emergency cease and desist order reciting with particularity the facts underlying such findings. The emergency cease and desist order is effective immediately upon service of a copy of the order on the respondent and remains effective for 90 days. If the office or department begins nonemergency cease and desist proceedings under subsection (1), the emergency cease and desist order remains effective, absent an order by an appellate court of competent jurisdiction pursuant to s. 120.68, until the conclusion of proceedings under ss. 120.569 and 120.57.
(3) The office or department may impose and collect an administrative fine not to exceed $10,000 for each nonwillful violation and $25,000 for each willful violation of any provision of this part.
History.—s. 10, ch. 99-212; s. 1058, ch. 2003-261.
626.99275 Prohibited practices; penalties.—
(1) It is unlawful for any person:
(a) To knowingly enter into, broker, or otherwise deal in a viatical settlement contract the subject of which is a life insurance policy, knowing that the policy was obtained by presenting materially false information concerning any fact material to the policy or by concealing, for the purpose of misleading another, information concerning any fact material to the policy, where the viator or the viator’s agent intended to defraud the policy’s issuer.
(b) To knowingly or with the intent to defraud, for the purpose of depriving another of property or for pecuniary gain, issue or use a pattern of false, misleading, or deceptive life expectancies.
(c) To knowingly engage in any transaction, practice, or course of business intending thereby to avoid the notice requirements of s. 626.9924(7).
(d) To knowingly or intentionally facilitate the change of state of residency of a viator to avoid the provisions of this chapter.
(2) A person who violates any provision of this section commits:
(a) A felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, if the insurance policy involved is valued at any amount less than $20,000.
(b) A felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, if the insurance policy involved is valued at $20,000 or more, but less than $100,000.
(c) A felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, if the insurance policy involved is valued at $100,000 or more.
History.—s. 11, ch. 99-212; s. 9, ch. 2000-344; s. 53, ch. 2001-63; s. 28, ch. 2005-237.
626.99278 Viatical provider anti-fraud plan.—Every licensed viatical settlement provider and registered life expectancy provider must adopt an anti-fraud plan and file it with the Division of Insurance Fraud of the department. Each anti-fraud plan shall include:
(1) A description of the procedures for detecting and investigating possible fraudulent acts and procedures for resolving material inconsistencies between medical records and insurance applications.
(2) A description of the procedures for the mandatory reporting of possible fraudulent insurance acts and prohibited practices set forth in s. 626.99275 to the Division of Insurance Fraud of the department.
(3) A description of the plan for anti-fraud education and training of its underwriters or other personnel.
(4) A written description or chart outlining the organizational arrangement of the anti-fraud personnel who are responsible for the investigation and reporting of possible fraudulent insurance acts and for the investigation of unresolved material inconsistencies between medical records and insurance applications.
(5) For viatical settlement providers, a description of the procedures used to perform initial and continuing review of the accuracy of life expectancies used in connection with a viatical settlement contract or viatical settlement investment.
History.—s. 10, ch. 2000-344; s. 29, ch. 2005-237.
626.9928 Acquisitions.—Acquisition of interest in a viatical settlement provider is subject to s. 628.4615.
History.—s. 19, ch. 96-336; s. 30, ch. 2005-237.
626.99285 Applicability of insurance code.—In addition to other applicable provisions cited in the insurance code, the office or department, as appropriate, has the authority granted under ss. 624.310, 626.901, and 626.989 to regulate viatical settlement providers, viatical settlement brokers, viatical settlement contracts, and viatical settlement transactions.
History.—s. 11, ch. 2000-344; s. 1059, ch. 2003-261; s. 31, ch. 2005-237.
626.99287 Contestability of viaticated policies.—Except as hereinafter provided, if a viatical settlement contract is entered into within the 2-year period commencing with the date of issuance of the insurance policy or certificate to be acquired, the viatical settlement contract is void and unenforceable by either party. Notwithstanding this limitation, such a viatical settlement contract is not void and unenforceable if:
(1) The policy was issued upon the owner’s exercise of conversion rights arising out of a group or term policy;
(2) The owner of the policy is a charitable organization exempt from taxation under 26 U.S.C. s. 501(c)(3);
(3) The owner of the policy is not a natural person;
(4) The viatical settlement contract was entered into before July 1, 2000;
(5) The viator certifies by producing independent evidence to the viatical settlement provider that one or more of the following conditions have been met within the 2-year period:
(a)1. The viator or insured is diagnosed with an illness or condition that is either:
a. Catastrophic or life threatening; or
b. Requires a course of treatment for a period of at least 3 years of long-term care or home health care; and
2. The condition was not known to the insured at the time the life insurance contract was entered into.
(b) The viator’s spouse dies;
(c) The viator divorces his or her spouse;
(d) The viator retires from full-time employment;
(e) The viator becomes physically or mentally disabled and a physician determines that the disability prevents the viator from maintaining full-time employment;
(f) The owner of the policy was the insured’s employer at the time the policy or certificate was issued and the employment relationship terminated;
(g) A final order, judgment, or decree is entered by a court of competent jurisdiction, on the application of a creditor of the viator, adjudicating the viator bankrupt or insolvent, or approving a petition seeking reorganization of the viator or appointing a receiver, trustee, or liquidator to all or a substantial part of the viator’s assets; or
(h) The viator experiences a significant decrease in income which is unexpected by the viator and which impairs his or her reasonable ability to pay the policy premium.
If the viatical settlement provider submits to the insurer a copy of the viator’s or owner’s certification described above, then the provider submits a request to the insurer to effect the transfer of the policy or certificate to the viatical settlement provider, the viatical settlement agreement shall not be void or unenforceable by operation of this section. The insurer shall timely respond to such request. Nothing in this section shall prohibit an insurer from exercising its right during the contestability period to contest the validity of any policy on grounds of fraud.
History.—s. 12, ch. 2000-344.
626.99295 Grace period.—Any person who, on July 1, 2005, is effectuating a viatical settlement purchase agreement made before July 1, 2005, under provisions of law in effect before such date, which viatical settlement purchase agreement was not registered pursuant to chapter 517, must proceed within 30 days after July 1, 2005, to conclude all viatical settlement purchase transactions in progress, provided, if funds have not been matched with a viaticated policy, such funds, or any unmatched portion of such funds, shall be returned to the viatical settlement purchaser within 30 days after July 1, 2005. The provider may not solicit, negotiate, advertise, or effectuate new viatical settlement purchase agreements after July 1, 2005.
History.—s. 13, ch. 2000-344; s. 1060, ch. 2003-261; s. 32, ch. 2005-237.
PART XI
STRUCTURED SETTLEMENTS626.99296 Transfers of structured settlement payment rights.
1626.99296 Transfers of structured settlement payment rights.—
(1) PURPOSE.—The purpose of this section is to protect recipients of structured settlements who are involved in the process of transferring structured settlement payment rights.
(2) DEFINITIONS.—As used in this section, the term:
(a) “Annuity issuer” means an insurer that has issued an annuity contract to be used to fund periodic payments under a structured settlement.
(b) “Applicable law” means any of the following, as applicable in interpreting the terms of a structured settlement:
1. The laws of the United States;
2. The laws of this state, including principles of equity applied in the courts of this state; and
3. The laws of any other jurisdiction:
a. That is the domicile of the payee or any other interested party;
b. Under whose laws a structured settlement agreement was approved by a court; or
c. In whose courts a settled claim was pending when the parties entered into a structured settlement agreement.
(c) “Applicable federal rate” means the most recently published applicable rate for determining the present value of an annuity, as issued by the United States Internal Revenue Service pursuant to s. 7520 of the United States Internal Revenue Code, as amended.
(d) “Assignee” means any party that acquires structured settlement payment rights directly or indirectly from a transferee of such rights.
(e) “Dependents” means a payee’s spouse and minor children and all other family members and other persons for whom the payee is legally obligated to provide support, including spousal maintenance.
(f) “Discount and finance charge” means the sum of all charges that are payable directly or indirectly from assigned structured settlement payments and imposed directly or indirectly by the transferee and that are incident to a transfer of structured settlement payment rights, including:
1. Interest charges, discounts, or other compensation for the time value of money;
2. All application, origination, processing, underwriting, closing, filing, and notary fees and all similar charges, however denominated; and
3. All charges for commissions or brokerage, regardless of the identity of the party to whom such charges are paid or payable.
The term does not include any fee or other obligation incurred by a payee in obtaining independent professional advice concerning a transfer of structured settlement payment rights.
(g) “Discounted present value” means, with respect to a proposed transfer of structured settlement payment rights, the fair present value of future payments, as determined by discounting the payments to the present using the most recently published applicable federal rate as the discount rate.
(h) “Independent professional advice” means advice of an attorney, certified public accountant, actuary, or other licensed professional adviser:
1. Who is engaged by a payee to render advice concerning the legal, tax, and financial implications of a transfer of structured settlement payment rights;
2. Who is not in any manner affiliated with or compensated by the transferee of the transfer; and
3. Whose compensation for providing the advice is not affected by whether a transfer occurs or does not occur.
(i) “Interested parties” means:
1. The payee;
2. Any beneficiary irrevocably designated under the annuity contract to receive payments following the payee’s death or, if such designated beneficiary is a minor, the designated beneficiary’s parent or guardian;
3. The annuity issuer;
4. The structured settlement obligor; or
5. Any other party who has continuing rights or obligations under the structured settlement.
(j) “Payee” means an individual who is receiving tax-free damage payments under a structured settlement and proposes to make a transfer of payment rights under the structured settlement.
(k) “Qualified assignment agreement” means an agreement providing for a qualified assignment, as authorized by 26 U.S.C. s. 130 of the United States Internal Revenue Code, as amended.
(l) “Settled claim” means the original tort claim resolved by a structured settlement.
(m) “Structured settlement” means an arrangement for periodic payment of damages for personal injuries established by settlement or judgment in resolution of a tort claim.
(n) “Structured settlement agreement” means the agreement, judgment, stipulation, or release embodying the terms of a structured settlement, including the rights of the payee to receive periodic payments.
(o) “Structured settlement obligor” means the party who is obligated to make continuing periodic payments to the payee under a structured settlement agreement or a qualified assignment agreement.
(p) “Structured settlement payment rights” means rights to receive periodic payments, including lump-sum payments under a structured settlement, whether from the structured settlement obligor or the annuity issuer, if:
1. The payee or any other interested party is domiciled in this state;
2. The structured settlement agreement was approved by a court of this state; or
3. The settled claim was pending before the courts of this state when the parties entered into the structured settlement agreement.
(q) “Terms of the structured settlement” means the terms of the structured settlement agreement; the annuity contract; a qualified assignment agreement; or an order or approval of a court or other government authority authorizing or approving the structured settlement.
(r) “Transfer” means a sale, assignment, pledge, hypothecation, or other form of alienation or encumbrance made by a payee for consideration.
(s) “Transfer agreement” means the agreement providing for transfer of structured settlement payment rights from a payee to a transferee.
(t) “Transferee” means a person who is receiving or who will receive structured settlement payment rights resulting from a transfer.
(3) CONDITIONS TO TRANSFERS OF STRUCTURED SETTLEMENT PAYMENT RIGHTS AND STRUCTURED SETTLEMENT AGREEMENTS.—
(a) A direct or indirect transfer of structured settlement payment rights is not effective and a structured settlement obligor or annuity issuer is not required to make a payment directly or indirectly to a transferee of structured settlement payment rights unless the transfer is authorized in advance in a final order by a court of competent jurisdiction which is based on the written express findings by the court that:
1. The transfer complies with this section and does not contravene other applicable law;
2. At least 10 days before the date on which the payee first incurred an obligation with respect to the transfer, the transferee provided to the payee a disclosure statement in bold type, no smaller than 14 points in size, which specifies:
a. The amounts and due dates of the structured settlement payments to be transferred;
b. The aggregate amount of the payments;
c. The discounted present value of the payments, together with the discount rate used in determining the discounted present value;
d. The gross amount payable to the payee in exchange for the payments;
e. An itemized listing of all brokers’ commissions, service charges, application fees, processing fees, closing costs, filing fees, referral fees, administrative fees, legal fees, and notary fees and other commissions, fees, costs, expenses, and charges payable by the payee or deductible from the gross amount otherwise payable to the payee;
f. The net amount payable to the payee after deducting all commissions, fees, costs, expenses, and charges described in sub-subparagraph e.;
g. The quotient, expressed as a percentage, obtained by dividing the net payment amount by the discounted present value of the payments, which must be disclosed in the following statement: “The net amount that you will receive from us in exchange for your future structured settlement payments represent percent of the estimated current value of the payments based upon the discounted value using the applicable federal rate”;
h. The effective annual interest rate, which must be disclosed in the following statement: “Based on the net amount that you will receive from us and the amounts and timing of the structured settlement payments that you are turning over to us, you will, in effect, be paying interest to us at a rate of percent per year”; and
i. The amount of any penalty and the aggregate amount of any liquidated damages, including penalties, payable by the payee in the event of a breach of the transfer agreement by the payee;
3. The payee has established that the transfer is in the best interests of the payee, taking into account the welfare and support of the payee’s dependents;
4. The payee has received, or waived his or her right to receive, independent professional advice regarding the legal, tax, and financial implications of the transfer;
5. The transferee has given written notice of the transferee’s name, address, and taxpayer identification number to the annuity issuer and the structured settlement obligor and has filed a copy of the notice with the court;
6. The transfer agreement provides that if the payee is domiciled in this state, any disputes between the parties will be governed in accordance with the laws of this state and that the domicile state of the payee is the proper venue to bring any cause of action arising out of a breach of the agreement; and
7. The court has determined that the net amount payable to the payee is fair, just, and reasonable under the circumstances then existing.
(b) If a proposed transfer would contravene the terms of the structured settlement, upon the filing of a written objection by any interested party and after considering the objection and any response to it, the court may grant, deny, or impose conditions upon the proposed transfer which the court deems just and proper given the facts and circumstances and in accordance with established principles of law. Any order approving a transfer must require that the transferee indemnify the annuity issuer and the structured settlement obligor for any liability, including reasonable costs and attorney’s fees, which arises from compliance by the issuer or obligor with the order of the court.
(c) Any provision in a transfer agreement which gives a transferee power to confess judgment against a payee is unenforceable to the extent that the amount of the judgment would exceed the amount paid by the transferee to the payee, less any payments received from the structured settlement obligor or payee.
(d) In negotiating a structured settlement of claims brought by or on behalf of a claimant who is domiciled in this state, the structured settlement obligor must disclose in writing to the claimant or the claimant’s legal representative all of the following information that is not otherwise specified in the structured settlement agreement:
1. The amounts and due dates of the periodic payments to be made under the structured settlement agreement. In the case of payments that will be subject to periodic percentage increases, the amounts of future payments may be disclosed by identifying the base payment amount, the amount and timing of scheduled increases, and the manner in which increases will be compounded;
2. The amount of the premium payable to the annuity issuer;
3. The discounted present value of all periodic payments that are not life-contingent, together with the discount rate used in determining the discounted present value;
4. The nature and amount of any costs that may be deducted from any of the periodic payments;
5. Where applicable, that any transfer of the periodic payments is prohibited by the terms of the structured settlement and may otherwise be prohibited or restricted under applicable law; and
6. That any transfer of the periodic payments by the claimant may subject the claimant to serious adverse tax consequences.
(4) JURISDICTION; PROCEDURE FOR APPROVAL OF TRANSFERS.—At least 20 days before the scheduled hearing on an application for authorizing a transfer of structured settlement payment rights under this section, the transferee must file with the court and all interested parties a notice of the proposed transfer and the application for its authorization. The notice must include:
(a) A copy of the transferee’s application to the court;
(b) A copy of the transfer agreement;
(c) A copy of the disclosure statement required under subsection (3);
(d) Notification that an interested party may support, oppose, or otherwise respond to the transferee’s application, in person or by counsel, by submitting written comments to the court or by participating in the hearing; and
(e) Notification of the time and place of the hearing and notification of the manner in which and the time by which any written response to the application must be filed in order to be considered by the court. A written response to an application must be filed within 15 days after service of the transferee’s notice.
(5) WAIVER PROHIBITED; NO PENALTIES INCURRED.—
(a) The provisions of this section may not be waived.
(b) If a transfer of structured settlement payment rights fails to satisfy the conditions of subsection (3), the payee who proposed the transfer does not incur any penalty, forfeit any application fee or other payment, or otherwise incur any liability to the proposed transferee.
(6) NONCOMPLIANCE.—
(a) If a transferee violates the requirements for stipulating the discount and finance charge provided for in subsection (3), neither the transferee nor any assignee may collect from the transferred payments, or from the payee, any amount in excess of the net advance amount, and the payee may recover from the transferee or any assignee:
1. A refund of any excess amounts previously received by the transferee or any assignee;
2. A penalty in an amount determined by the court, but not in excess of three times the aggregate amount of the discount and finance charge; and
3. Reasonable costs and attorney’s fees.
(b) If the transferee violates the disclosure requirements in subsection (3), the transferee and any assignee are liable to the payee for:
1. A penalty in an amount determined by the court, but not in excess of three times the amount of the discount and finance charge; and
2. Reasonable costs and attorney’s fees.
(c) A transferee or assignee is not liable for any penalty in any action brought under this section if the transferee or assignee establishes by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error, notwithstanding the transferee’s maintenance of procedures reasonably designed to avoid such errors.
(d) Notwithstanding any other law, an action may not be brought under this section more than 1 year after the due date of:
1. The last transferred structured settlement payment, in the case of a violation of the requirements for stipulating the discount and finance charge provided for in subsection (3).
2. The first transferred structured settlement payment, in the case of a violation of the disclosure requirements of subsection (3).
(e) When any interested party has reason to believe that any transferee has violated this section, any interested party may bring a civil action for injunctive relief, penalties, and any other relief that is appropriate to secure compliance with this section.
History.—s. 7, ch. 2001-207; s. 7, ch. 2001-247.
1Note.—Section 30, ch. 2001-198, provides that “[n]othing contained in s. 679.4061, Florida Statutes, or s. 679.4081, Florida Statutes, as created by this act, shall supersede the provisions of SB 108 or HB 767, relating to structured settlements, if Senate Bill 108 or House Bill 767 becomes a law.” Committee Substitute for Committee Substitute for Senate Bill 108 became ch. 2001-207; s. 7, ch. 2001-207, relates to structured settlements. House Bill 767 did not pass.