HB 0591

1
A bill to be entitled
2An act relating to insurance agents and agencies; amending
3s. 624.317, F.S.; including insurance agencies among
4entities the Department of Financial Services is
5authorized to investigate; amending s. 624.501, F.S.;
6clarifying a license fee; amending s. 626.016, F.S.;
7including insurance agencies among entities subject to
8regulation by the Chief Financial Officer; amending s.
9626.022, F.S.; providing application; amending s. 626.025,
10F.S.; correcting cross references; amending s. 626.112,
11F.S.; delaying the effective date by which agencies must
12obtain a license; providing that an agency may file for
13registration in lieu of licensure, under specified
14conditions; imposing a fine on any agency that fails to
15timely apply for licensure or registration; deleting
16certain agency licensure requirement provisions; amending
17s. 626.171, F.S.; specifying licensure and registration
18application requirements for insurance entities other than
19insurance agencies; deleting a provision applying to
20insurance agency license application requirements;
21amending s. 626.172, F.S.; revising insurance agency
22licensure application requirements; providing procedures
23and limitations; providing duties of the department;
24amending ss. 626.292 and 626.321, F.S.; correcting cross
25references, to conform; amending s. 626.342, F.S.;
26including insurance agencies under provisions prohibiting
27furnishing supplies to certain unlicensed agents and
28imposing civil liability under certain circumstances;
29amending s. 626.382, F.S.; providing for renewal of
30licenses; amending s. 626.536, F.S.; including insurance
31agencies under an action reporting requirement; amending
32s. 626.561, F.S.; including insurance agencies under
33provisions providing funds reporting and accounting
34requirements and imposing criminal penalties; amending s.
35626.572, F.S.; including  insurance agencies under
36provisions prohibiting rebating under certain
37circumstances; amending s. 626.601, F.S.; including
38insurance agencies under provisions authorizing the
39department to inquire into improper conduct; creating s.
40626.602, F.S.; authorizing the department to disapprove
41the use of certain names under certain circumstances;
42amending s. 626.6115, F.S.; providing an additional ground
43for the department to take compulsory adverse insurance
44agency license actions; providing that the existence of
45grounds for adverse action against a licensed agency does
46not constitute grounds for adverse action against another
47licensed agency; amending s. 626.6215, F.S.; providing an
48additional ground for the department to take discretionary
49adverse insurance agency license actions; providing that
50the existence of grounds for adverse action against a
51licensed agency does not constitute grounds for adverse
52action against another licensed agency; amending s.
53626.747, F.S.; revising agent requirements for branch
54agencies to include life or health agents; amending ss.
55626.7355 and 626.8411, F.S.; deleting cross references, to
56conform; repealing s. 626.592, F.S., relating to primary
57agents; providing an effective date.
58
59Be It Enacted by the Legislature of the State of Florida:
60
61     Section 1.  Subsection (1) of section 624.317, Florida
62Statutes, is amended to read:
63     624.317  Investigation of agents, agencies, adjusters,
64administrators, service companies, and others.--If it has reason
65to believe that any person has violated or is violating any
66provision of this code, or upon the written complaint signed by
67any interested person indicating that any such violation may
68exist:
69     (1)  The department shall conduct such investigation as it
70deems necessary of the accounts, records, documents, and
71transactions pertaining to or affecting the insurance affairs of
72any general agent, surplus lines agent, adjuster, managing
73general agent, insurance agent, insurance agency, customer
74representative, service representative, or other person subject
75to its jurisdiction, subject to the requirements of s. 626.601.
76     Section 2.  Subsection (20) of section 624.501, Florida
77Statutes, is amended to read:
78     624.501  Filing, license, appointment, and miscellaneous
79fees.--The department, commission, or office, as appropriate,
80shall collect in advance, and persons so served shall pay to it
81in advance, fees, licenses, and miscellaneous charges as
82follows:
83     (20)  Insurance agency or Adjusting firm, original or
84renewal 3-year license....$60.00
85     Section 3.  Subsection (1) of section 626.016, Florida
86Statutes, is amended to read:
87     626.016  Powers and duties of department, commission, and
88office.--
89     (1)  The powers and duties of the Chief Financial Officer
90and the department specified in this part apply only with
91respect to insurance agents, insurance agencies, managing
92general agents, insurance adjusters, reinsurance intermediaries,
93viatical settlement brokers, customer representatives, service
94representatives, and agencies.
95     Section 4.  Subsection (4) is added to section 626.022,
96Florida Statutes, to read:
97     626.022  Scope of part.--
98     (4)  Provisions of this part that apply to general lines
99agents and applicants also apply to personal lines agents and
100applicants, except where otherwise provided.
101     Section 5.  Subsections (7) and (12) of section 626.025,
102Florida Statutes, are amended, and subsections (13), (14), and
103(15) of said section are renumbered as subsections (12), (13),
104and (14), respectively, to read:
105     626.025  Consumer protections.--To transact insurance,
106agents shall comply with consumer protection laws, including the
107following, as applicable:
108     (7)  Required licensure or registration of certain
109insurance agencies under s. 626.112 626.172.
110     (12)  Designation of a primary agent by an insurance agency
111under s. 626.592.
112     Section 6.  Subsection (7) of section 626.112, Florida
113Statutes, is amended to read:
114     626.112  License and appointment required; agents, customer
115representatives, adjusters, insurance agencies, service
116representatives, managing general agents.--
117     (7)(a)  Effective October 1, 2006, no individual, firm,
118partnership, corporation, association, or any other entity shall
119act in its own name or under a trade name, directly or
120indirectly, as an insurance agency, when required to be licensed
121by this subsection, unless it complies with s. 626.172 with
122respect to possessing an insurance agency license for each place
123of business at which it engages in any activity which may be
124performed only by a licensed insurance agent. Each agency
125engaged in business in this state before January  1, 2001, which
126is wholly owned by insurance agents currently licensed and
127appointed under this chapter, each incorporated agency whose
128voting shares are traded on a securities exchange, and each
129agency whose primary function is offering insurance as a service
130or member benefit to members of a nonprofit corporation may file
131an application for registration in lieu of licensure in
132accordance with s. 626.172(3). Each agency engaged in business
133before October 1, 2006, shall file an application for licensure
134or registration on or before October 1, 2006.
135     1.  If an agency is required to be licensed but fails to
136file an application for licensure in accordance with this
137section, the department shall impose on the agency an
138administrative penalty in an amount of up to $10,000.
139     2.  If an agency is eligible for registration but fails to
140file an application for registration or an application for
141licensure in accordance with this section, the department shall
142impose on the agency an administrative penalty in an amount of
143up to $5,000.
144     (b)  A registered An insurance agency shall, as a condition
145precedent to continuing business, obtain an insurance agency
146license if the department finds that, with respect to any
147majority owner, partner, manager, director, officer, or other
148person who manages or controls the agency, any person has,
149subsequent to the effective date of this act:
150     1.  Been found guilty of, or has pleaded guilty or nolo
151contendere to, a felony in this state or any other state
152relating to the business of insurance or to an insurance agency,
153without regard to whether a judgment of conviction has been
154entered by the court having jurisdiction of the cases.
155     2.  Employed any individual in a managerial capacity or in
156a capacity dealing with the public who is under an order of
157revocation or suspension issued by the department. An insurance
158agency may request, on forms prescribed by the department,
159verification of any person's license status. If a request is
160mailed within 5 working days after an employee is hired, and the
161employee's license is currently suspended or revoked, the agency
162shall not be required to obtain a license, if the unlicensed
163person's employment is immediately terminated.
164     3.  Operated the agency or permitted the agency to be
165operated in violation of s. 626.747.
166     4.  With such frequency as to have made the operation of
167the agency hazardous to the insurance-buying public or other
168persons:
169     a.  Solicited or handled controlled business. This
170subparagraph shall not prohibit the licensing of any lending or
171financing institution or creditor, with respect to insurance
172only, under credit life or disability insurance policies of
173borrowers from the institutions, which policies are subject to
174part IX of chapter 627.
175     b.  Misappropriated, converted, or unlawfully withheld
176moneys belonging to insurers, insureds, beneficiaries, or others
177and received in the conduct of business under the license.
178     c.  Unlawfully rebated, attempted to unlawfully rebate, or
179unlawfully divided or offered to divide commissions with
180another.
181     d.  Misrepresented any insurance policy or annuity
182contract, or used deception with regard to any policy or
183contract, done either in person or by any form of dissemination
184of information or advertising.
185     e.  Violated any provision of this code or any other law
186applicable to the business of insurance in the course of dealing
187under the license.
188     f.  Violated any lawful order or rule of the department.
189     g.  Failed or refused, upon demand, to pay over to any
190insurer he or she represents or has represented any money coming
191into his or her hands belonging to the insurer.
192     h.  Violated the provision against twisting as defined in
193s. 626.9541(1)(l).
194     i.  In the conduct of business, engaged in unfair methods
195of competition or in unfair or deceptive acts or practices, as
196prohibited under part IX of this chapter.
197     j.  Willfully overinsured any property insurance risk.
198     k.  Engaged in fraudulent or dishonest practices in the
199conduct of business arising out of activities related to
200insurance or the insurance agency.
201     l.  Demonstrated lack of fitness or trustworthiness to
202engage in the business of insurance arising out of activities
203related to insurance or the insurance agency.
204     m.  Authorized or knowingly allowed individuals to transact
205insurance who were not then licensed as required by this code.
206     5.  Knowingly employed any person who within the preceding
2073 years has had his or her relationship with an agency
208terminated in accordance with paragraph (d).
209     6.  Willfully circumvented the requirements or prohibitions
210of this code.
211     (c)  An agency required to be licensed in accordance with
212paragraph (b) shall remain so licensed for a period of 3 years
213from the date of licensure unless the license is suspended or
214revoked in accordance with law. The department may revoke or
215suspend the agency authority to do business for activities
216occurring during the time the agency is licensed, regardless of
217whether the licensing period has terminated.
218     (d)  Notwithstanding the provisions of this subsection, no
219insurance agency shall be required to apply for an agency
220license if such agency can prove to the department that:
221     1.  The agency is severing its relationship with each
222majority owner, partner, manager, director, officer, or other
223person who managed or controlled such agency and who violated
224any of the provisions of paragraph (b).
225     2.  No such majority owner, partner, manager, director,
226officer, or other person who managed such agency is to be
227affiliated with such agency in any capacity for a period of 3
228years from the date of such severance.
229     Section 7.  Section 626.171, Florida Statutes, is amended
230to read:
231     626.171  Application for license as an agent, customer
232representative, adjuster, service representative, managing
233general agent, or reinsurance intermediary.--
234     (1)  The department shall not issue a license as an agent,
235customer representative, adjuster, insurance agency, service
236representative, managing general agent, or reinsurance
237intermediary to any person except upon written application
238therefor filed with it, qualification therefor, and payment in
239advance of all applicable fees. Any such application shall be
240made under the oath of the applicant and be signed by the
241applicant. Beginning November 1, 2002, The department shall
242accept the uniform application for nonresident agent licensing.
243The department may adopt revised versions of the uniform
244application by rule.
245     (2)  In the application, the applicant shall set forth:
246     (a)  His or her full name, age, social security number,
247residence address, business address, and mailing address.
248     (b)  Proof that he or she has completed or is in the
249process of completing any required prelicensing course.
250     (c)  Whether he or she has been refused or has voluntarily
251surrendered or has had suspended or revoked a license to solicit
252insurance by the department or by the supervising officials of
253any state.
254     (d)  Whether any insurer or any managing general agent
255claims the applicant is indebted under any agency contract or
256otherwise and, if so, the name of the claimant, the nature of
257the claim, and the applicant's defense thereto, if any.
258     (e)  Proof that the applicant meets the requirements for
259the type of license for which he or she is applying.
260     (f)  Such other or additional information as the department
261may deem proper to enable it to determine the character,
262experience, ability, and other qualifications of the applicant
263to hold himself or herself out to the public as an insurance
264representative.
265     (3)  An application for an insurance agency license shall
266be signed by the owner or owners of the agency. If the agency is
267incorporated, the application shall be signed by the president
268and secretary of the corporation.
269     (3)(4)  Each application shall be accompanied by payment of
270any applicable fee.
271     (4)(5)  An application for a license as an agent, customer
272representative, adjuster, insurance agency, service
273representative, managing general agent, or reinsurance
274intermediary must be accompanied by a set of the individual
275applicant's fingerprints, or, if the applicant is not an
276individual, by a set of the fingerprints of the sole proprietor,
277majority owner, partners, officers, and directors, on a form
278adopted by rule of the department and accompanied by the
279fingerprint processing fee set forth in s. 624.501. Fingerprints
280shall be used to investigate the applicant's qualifications
281pursuant to s. 626.201. The fingerprints shall be taken by a law
282enforcement agency or other department-approved entity.
283     (5)(6)  The application for license filing fee prescribed
284in s. 624.501 is not subject to refund.
285     (6)(7)  Pursuant to the federal Personal Responsibility and
286Work Opportunity Reconciliation Act of 1996, each party is
287required to provide his or her social security number in
288accordance with this section. Disclosure of social security
289numbers obtained through this requirement shall be limited to
290the purpose of administration of the Title IV-D program for
291child support enforcement.
292     Section 8.  Section 626.172, Florida Statutes, is amended
293to read:
294     626.172  Application for insurance agency license.--
295     (1)  The department may issue a license as an insurance
296agency to any person only after such person files a written
297application with the department and qualifies for such license.
298If any majority owner, partner, officer, or director of an
299insurance agency:
300     (a)  Has been found guilty of, or has pleaded guilty or
301nolo contendere to, a felony relating to the business of
302insurance in this state or any other state or federal court,
303regardless of whether a judgment of conviction has been entered
304by the court having jurisdiction of such cases; or
305     (b)  Has been denied a license relating to the business of
306insurance, or has had his or her license to practice or conduct
307any regulated profession, business, or vocation relating to the
308business of insurance revoked or suspended, by this or any other
309state, any nation, any possession or district of the United
310States, or any court, or any lawful agency thereof;
311
312the insurance agency and any subsidiary or branch thereof shall
313obtain a license from the department pursuant to this section.
314     (2)  An application for an insurance agency license shall
315be signed by the owner or owners of the agency. If the agency is
316incorporated, the application shall be signed by the president
317and secretary of the corporation. The application for an
318insurance agency license shall include:
319     (a)  The name of each majority owner, partner, officer, and
320director of the insurance agency.
321     (b)  The residence address of each person required to be
322listed in the application under paragraph (a).
323     (c)  The name of the insurance agency and its principal
324business address.
325     (d)  The location of each agency office and the name under
326which each agency office conducts or will conduct business.
327     (e)  The name of each agent to be in full-time charge of an
328agency office and specification of which office.
329     (f)  The fingerprints of each of the following:
330     1.  A sole proprietor.
331     2.  Each partner.
332     3.  Each owner of an unincorporated agency.
333     4.  Each owner who directs or participates in the
334management or control of an incorporated agency whose shares are
335not traded on a securities exchange.
336     5.  Each owner of 10 percent or more of the voting shares
337of a corporation which are traded on a securities exchange who
338directs or participates in the management or control of an
339incorporated agency.
340     6.  The president, senior vice-presidents, treasurer,
341secretary, and directors of the agency.
342     7.  Any other person who directs or participates in the
343management or control of the agency, whether through the
344ownership of voting securities, by contract, or otherwise.
345
346Fingerprints must be taken by a law enforcement agency or other
347entity approved by the department and must be accompanied by the
348fingerprint processing fee specified in s. 624.501. However,
349fingerprints need not be filed for any individual who is
350currently licensed and appointed under this chapter. This
351paragraph does not apply to corporations whose voting shares are
352traded on a securities exchange.
353The name of any person to whom subsection (1) applies.
354     (g)  Such additional information as the department requires
355by promulgated rule to ascertain the trustworthiness and
356competence of persons required to be listed on the application
357and to ascertain that such persons meet the requirements of this
358code. However, the department may not require that credit or
359character reports be submitted for persons required to be listed
360on the application.
361     (h)  Beginning October 1, 2005, the department shall accept
362the uniform application for nonresident agency licensure. The
363department may adopt by rule revised versions of the uniform
364application.
365     (3)  The department shall issue a registration as an
366insurance agency to any agency that files a written application
367with the department and qualifies for registration. The
368application for registration shall require the agency to provide
369the same information required for an agency licensed under
370subsection (2), the agent identification number for each owner
371who is a licensed agent, proof that the agency qualifies for
372registration as provided in s. 626.112(7), and any other
373additional information that the department determines is
374necessary in order to demonstrate that the agency qualifies for
375registration. The application must be signed by the owner or
376owners of the agency. If the agency is incorporated, the
377application must be signed by the president and the secretary of
378the corporation. An agent who owns the agency need not file
379fingerprints with the department if the agent obtained a license
380under this chapter, and the license is currently valid.
381     (a)  If an application for registration is denied, the
382agency must file an application for licensure no later than 30
383days after the date of the denial of registration.
384     (b)  A registered insurance agency must file an application
385for licensure no later than 30 days after the date that any
386person who is not a licensed and appointed agent in this state
387acquires any ownership interest in the agency. If an agency
388fails to file an application for licensure in compliance with
389this paragraph, the department shall impose an administrative
390penalty in an amount of up to $5,000 on the agency.
391     (c)  Sections 626.6115 and 626.6215 do not apply to
392agencies registered under this subsection.
393     (4)  The department shall issue a license or registration
394to each agency upon approval of the application and each agency
395shall display the license or registration prominently in a
396manner that makes it clearly visible to any customer or
397potential customer who enters the agency.
398     Section 9.  Paragraph (c) of subsection (2) of section
399626.292, Florida Statutes, is amended to read:
400     626.292  Transfer of license from another state.--
401     (2)  To qualify for a license transfer, an individual
402applicant must meet the following requirements:
403     (c)  The individual shall submit a completed application
404for this state which is received by the department within 90
405days after the date the individual became a resident of this
406state, along with payment of the applicable fees set forth in s.
407624.501 and submission of the following documents:
408     1.  A certification issued by the appropriate official of
409the applicant's home state identifying the type of license and
410lines of authority under the license and stating that, at the
411time the license from the home state was canceled, the applicant
412was in good standing in that state or that the state's Producer
413Database records, maintained by the National Association of
414Insurance Commissioners, its affiliates, or subsidiaries,
415indicate that the agent is or was licensed in good standing for
416the line of authority requested.
417     2.  A set of the individual applicant's fingerprints in
418accordance with s. 626.171(4)(5).
419     Section 10.  Paragraph (d) of subsection (1) and paragraph
420(a) of subsection (2) and of section 626.321, Florida Statutes,
421are amended to read:
422     626.321  Limited licenses.--
423     (1)  The department shall issue to a qualified individual,
424or a qualified individual or entity under paragraphs (c), (d),
425(e), and (i), a license as agent authorized to transact a
426limited class of business in any of the following categories:
427     (d)  Baggage and motor vehicle excess liability insurance.-
428-
429     1.  License covering only insurance of personal effects
430except as provided in subparagraph 2. The license may be issued
431only:
432     a.  To a full-time salaried employee of a common carrier or
433a full-time salaried employee or owner of a transportation
434ticket agency, which person is engaged in the sale or handling
435of transportation of baggage and personal effects of travelers,
436and may authorize the sale of such insurance only in connection
437with such transportation; or
438     b.  To the full-time salaried employee of a licensed
439general lines agent or to a business entity that offers motor
440vehicles for rent or lease if insurance sales activities
441authorized by the license are in connection with and incidental
442to the rental of a motor vehicle. An entity applying for a
443license under this sub-subparagraph:
444     (I)  Is required to submit only one application for a
445license under s. 626.171. The requirements of s. 626.171(4)(5)
446shall apply only to the officers and directors of the entity
447submitting the application.
448     (II)  Is required to obtain a license for each office,
449branch office, or place of business making use of the entity's
450business name by applying to the department for the license on a
451simplified application form developed by rule of the department
452for this purpose.
453     (III)  Is required to pay the applicable fees for a license
454as prescribed in s. 624.501, be appointed under s. 626.112, and
455pay the prescribed appointment fee under s. 624.501. A licensed
456and appointed entity shall be directly responsible and
457accountable for all acts of the licensee's employees.
458
459The purchaser of baggage insurance shall be provided written
460information disclosing that the insured's homeowner's policy may
461provide coverage for loss of personal effects and that the
462purchase of such insurance is not required in connection with
463the purchase of tickets or in connection with the lease or
464rental of a motor vehicle.
465     2.  A business entity that offers motor vehicles for rent
466or lease, may include lessees under a master contract providing
467coverage to the lessor or may transact excess motor vehicle
468liability insurance providing coverage in excess of the standard
469liability limits provided by the lessor in its lease to a person
470renting or leasing a motor vehicle from the licensee's employer
471for liability arising in connection with the negligent operation
472of the leased or rented motor vehicle, provided that the lease
473or rental agreement is for not more than 30 days; that the
474lessee is not provided coverage for more than 30 consecutive
475days per lease period, and, if the lease is extended beyond 30
476days, the coverage may be extended one time only for a period
477not to exceed an additional 30 days; that the lessee is given
478written notice that his or her personal insurance policy
479providing coverage on an owned motor vehicle may provide
480additional excess coverage; and that the purchase of the
481insurance is not required in connection with the lease or rental
482of a motor vehicle. The excess liability insurance may be
483provided to the lessee as an additional insured on a policy
484issued to the licensee's employer.
485     3.  A business entity that offers motor vehicles for rent
486or lease, may, as an agent of an insurer, transact insurance
487that provides coverage for the liability of the lessee to the
488lessor for damage to the leased or rented motor vehicle if:
489     a.  The lease or rental agreement is for not more than 30
490days; or the lessee is not provided coverage for more than 30
491consecutive days per lease period, but, if the lease is extended
492beyond 30 days, the coverage may be extended one time only for a
493period not to exceed an additional 30 days;
494     b.  The lessee is given written notice that his or her
495personal insurance policy that provides coverage on an owned
496motor vehicle may provide such coverage with or without a
497deductible; and
498     c.  The purchase of the insurance is not required in
499connection with the lease or rental of a motor vehicle.
500     (2)  An entity applying for a license under this section is
501required to:
502     (a)  Submit only one application for a license under s.
503626.171. The requirements of s. 626.171(4)(5) shall only apply
504to the officers and directors of the entity submitting the
505application.
506     Section 11.  Subsections (1) and (2) of section 626.342,
507Florida Statutes, are amended to read:
508     626.342  Furnishing supplies to unlicensed life, health, or
509general lines agent prohibited; civil liability.--
510     (1)  An insurer, a managing general agent, an insurance
511agency, or an agent, directly or through any representative, may
512not furnish to any agent any blank forms, applications,
513stationery, or other supplies to be used in soliciting,
514negotiating, or effecting contracts of insurance on its behalf
515unless such blank forms, applications, stationery, or other
516supplies relate to a class of business with respect to which the
517agent is licensed and appointed, whether for that insurer or
518another insurer.
519     (2)  Any insurer, general agent, insurance agency, or agent
520who furnishes any of the supplies specified in subsection (1) to
521any agent or prospective agent not appointed to represent the
522insurer and who accepts from or writes any insurance business
523for such agent or agency is subject to civil liability to any
524insured of such insurer to the same extent and in the same
525manner as if such agent or prospective agent had been appointed
526or authorized by the insurer or such agent to act in its or his
527or her behalf. The provisions of this subsection do not apply to
528insurance risk apportionment plans under s. 627.351.
529     Section 12.  Section 626.382, Florida Statutes, is amended
530to read:
531     626.382  Continuation, expiration of license; insurance
532agencies.--The license of any insurance agency shall be issued
533for a period of 3 years, subject to the payment of the fees
534prescribed in s. 624.501, and shall continue in force until
535canceled, suspended, revoked, or otherwise terminated. A license
536may be renewed by submitting a renewal request to the department
537on a form adopted by department rule.
538     Section 13.  Section 626.536, Florida Statutes, is amended
539to read:
540     626.536  Reporting of actions.--Each An agent and insurance
541agency shall submit to the department, within 30 days after the
542final disposition of any administrative action taken against the
543agent by a governmental agency in this or any other state or
544jurisdiction relating to the business of insurance, the sale of
545securities, or activity involving fraud, dishonesty,
546trustworthiness, or breach of a fiduciary duty, a copy of the
547order, consent to order, or other relevant legal documents. The
548department may adopt rules implementing the provisions of this
549section.
550     Section 14.  Subsections (1) and (3) of section 626.561,
551Florida Statutes, are amended to read:
552     626.561  Reporting and accounting for funds.--
553     (1)  All premiums, return premiums, or other funds
554belonging to insurers or others received by an agent, insurance
555agency, customer representative, or adjuster in transactions
556under the his or her license are trust funds received by the
557licensee in a fiduciary capacity. An agent or insurance agency
558shall keep the funds belonging to each insurer for which an
559agent he or she is not appointed, other than a surplus lines
560insurer, in a separate account so as to allow the department or
561office to properly audit such funds. The licensee in the
562applicable regular course of business shall account for and pay
563the same to the insurer, insured, or other person entitled
564thereto.
565     (3)  Any agent, insurance agency, customer representative,
566or adjuster who, not being lawfully entitled thereto, either
567temporarily or permanently diverts or misappropriates such funds
568or any portion thereof or deprives the other person of a benefit
569therefrom commits the offense specified below:
570     (a)  If the funds diverted or misappropriated are $300 or
571less, a misdemeanor of the first degree, punishable as provided
572in s. 775.082 or s. 775.083.
573     (b)  If the funds diverted or misappropriated are more than
574$300, but less than $20,000, a felony of the third degree,
575punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
576     (c)  If the funds diverted or misappropriated are $20,000
577or more, but less than $100,000, a felony of the second degree,
578punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
579     (d)  If the funds diverted or misappropriated are $100,000
580or more, a felony of the first degree, punishable as provided in
581s. 775.082, s. 775.083, or s. 775.084.
582     Section 15.  Subsections (1) and (2) of section 626.572,
583Florida Statutes, are amended to read:
584     626.572  Rebating; when allowed.--
585     (1)  No insurance agency or agent shall rebate any portion
586of a his or her commission except as follows:
587     (a)  The rebate shall be available to all insureds in the
588same actuarial class.
589     (b)  The rebate shall be in accordance with a rebating
590schedule filed by the agent with the insurer issuing the policy
591to which the rebate applies.
592     (c)  The rebating schedule shall be uniformly applied in
593that all insureds who purchase the same policy through the agent
594for the same amount of insurance receive the same percentage
595rebate.
596     (d)  Rebates shall not be given to an insured with respect
597to a policy purchased from an insurer that prohibits its agents
598from rebating commissions.
599     (e)  The rebate schedule is prominently displayed in public
600view in the agent's place of doing business and a copy is
601available to insureds on request at no charge.
602     (f)  The age, sex, place of residence, race, nationality,
603ethnic origin, marital status, or occupation of the insured or
604location of the risk is not utilized in determining the
605percentage of the rebate or whether a rebate is available.
606     (2)  The insurance agency or agent shall maintain a copy of
607all rebate schedules for the most recent 5 years and their
608effective dates.
609     Section 16.  Subsection (1) of section 626.601, Florida
610Statutes, is amended to read:
611     626.601  Improper conduct; inquiry; fingerprinting.--
612     (1)  The department or office may, upon its own motion or
613upon a written complaint signed by any interested person and
614filed with the department or office, inquire into any alleged
615improper conduct of any licensed insurance agency, agent,
616adjuster, service representative, managing general agent,
617customer representative, title insurance agent, title insurance
618agency, continuing education course provider, instructor, school
619official, or monitor group under this code. The department or
620office may thereafter initiate an investigation of any such
621licensee if it has reasonable cause to believe that the licensee
622has violated any provision of the insurance code. During the
623course of its investigation, the department or office shall
624contact the licensee being investigated unless it determines
625that contacting such person could jeopardize the successful
626completion of the investigation or cause injury to the public.
627     Section 17.  Section 626.602, Florida Statutes, is created
628to read:
629     626.602  Insurance agency names; disapproval.--The
630department may disapprove the use of any true or fictitious
631name, other than the bona fide natural name of an individual, by
632any insurance agency on any of the following grounds:
633     (1)  The name is an interference with or is too similar to
634a name already filed and in use by another agency or insurer;
635     (2)  The use of the name may mislead the public in any
636respect;
637     (3)  The name states or implies that the agency is an
638insurer, motor club, hospital service plan, state or federal
639agency, charitable organization, or entity that primarily
640provides advice and counsel rather than sells or solicits
641insurance, or is entitled to engage in insurance activities not
642permitted under licenses held or applied for; or
643     (4)  The name states or implies that the agency is an
644underwriter. This subsection does not prevent a natural person
645who is a life agent from describing himself or herself as an
646underwriter or from using the designation "chartered life
647underwriter" or who is a general lines agent from using the
648designation "chartered property and casualty underwriter," if
649the person is entitled to use such terms to describe himself or
650herself.
651     Section 18.  Section 626.6115, Florida Statutes, is amended
652to read:
653     626.6115  Grounds for compulsory refusal, suspension, or
654revocation of insurance agency license.--The department shall
655deny, suspend, revoke, or refuse to continue the license of any
656insurance agency if it finds, as to any insurance agency or as
657to any majority owner, partner, manager, director, officer, or
658other person who manages or controls such agency, that any
659either one or both of the following applicable grounds exist:
660     (1)  Lack by the agency of one or more of the
661qualifications for the license as specified in this code.
662     (2)  Material misstatement, misrepresentation, or fraud in
663obtaining the license or in attempting to obtain the license.
664     (3)  Denial, suspension, or revocation of a license to
665practice or conduct any regulated profession, business, or
666vocation relating to the business of insurance by this state,
667any other state, any nation, any possession or district of the
668United States, any court, or any lawful agency thereof. However,
669the existence of grounds for administrative action against a
670licensed agency does not constitute grounds for action against
671any other licensed agency, including an agency that owns, is
672under common ownership with, or is owned by, in whole or in
673part, the agency for which grounds for administrative action
674exist.
675     Section 19.  Subsection (6) is added to section 626.6215,
676Florida Statutes, to read:
677     626.6215  Grounds for discretionary refusal, suspension, or
678revocation of insurance agency license.--The department may, in
679its discretion, deny, suspend, revoke, or refuse to continue the
680license of any insurance agency if it finds, as to any insurance
681agency or as to any majority owner, partner, manager, director,
682officer, or other person who manages or controls such insurance
683agency, that any one or more of the following applicable grounds
684exist:
685     (6)  Failure to take corrective action or report a
686violation to the department within 30 days after an individual
687licensee's violation is known or should have been known by one
688or more of the partners, officers, or managers acting on behalf
689of the agency. However, the existence of grounds for
690administrative action against a licensed agency does not
691constitute grounds for action against any other licensed agency,
692including an agency that owns, is under common ownership with,
693or is owned by, in whole or in part, the agency for which
694grounds for administrative action exist.
695     Section 20.  Subsection (2) of section 626.7355, Florida
696Statutes, is amended to read:
697     626.7355  Temporary license as customer representative
698pending examination.--
699     (2)  There must be no more than one temporary customer
700representative licensee in the general lines agency location
701where the temporary licensee is housed and the temporary
702licensee shall be housed wholly and completely within the actual
703confines of the office of the agent or agency whom he or she
704represents. Such agency must be in compliance with the
705provisions of s. 626.592, commonly referred to as the Primary
706Agent Law, for the most recent reporting period. No such
707temporary licensee may be employed from any location except
708where his or her designated supervising general lines agent
709spends his or her full time. No general lines agency location
710may employ more than two temporary customer representative
711licensees in one calendar year.
712     Section 21.  Subsection (1) of section 626.747, Florida
713Statutes, is amended to read:
714     626.747  Branch agencies.--
715     (1)  Each branch place of business established by an agent
716or agency, firm, corporation, or association shall be in the
717active full-time charge of a licensed general lines agent who is
718appointed to represent one or more insurers. Any agent or
719agency, firm, corporation, or association which has established
720one or more branch places of business shall be required to have
721at least one licensed general lines agent or life or health
722agent who is appointed to represent one or more insurers at each
723location of the agency, including its headquarters location.
724     Section 22.  Paragraph (d) of subsection (2) of section
725626.8411, Florida Statutes, is amended to read:
726     626.8411  Application of Florida Insurance Code provisions
727to title insurance agents or agencies.--
728     (2)  The following provisions of part I do not apply to
729title insurance agents or title insurance agencies:
730     (d)  Section 626.592, relating to primary agents.
731     Section 23.  Section 626.592, Florida Statutes, is
732repealed.
733     Section 24.  This act shall take effect October 1, 2005.


CODING: Words stricken are deletions; words underlined are additions.