CS/CS/HB 1381

1
A bill to be entitled
2An act relating to insurance; amending s. 626.112, F.S.;
3authorizing certain agencies designated as a branch office
4to file an application for registration in lieu of
5licensure; amending s. 626.221, F.S.; providing an
6exemption from the required written examination to certain
7applicants for licensure as a claims adjuster; amending s.
8626.7851, F.S.; authorizing certain programs to offer
9correspondence courses to applicants for licensure as a
10life insurance agent; amending s. 626.8311, F.S.;
11authorizing certain programs to offer correspondence
12courses to applicants for licensure as a health insurance
13agent; amending s. 626.747, F.S.; authorizing certain
14licensed agents to be the agent in charge of branch
15locations under certain circumstances; amending s.
16626.865, F.S.; requiring public adjusters to maintain
17their surety bond unimpaired for a certain period;
18amending s. 626.869, F.S.; authorizing an extension of
19time to complete continuing education requirements for
20public adjusters; amending s. 626.8698, F.S.; designating
21the Department of Financial Services as the appropriate
22agency responsible for disciplinary action against public
23adjusters; amending s. 626.921, F.S.; providing that the
24department is responsible for approval of the surplus
25lines agent manual; amending s. 626.9531, F.S.; revising
26requirements for identification of insurers, agents, and
27insurance contracts; specifying absence of liability and
28prohibiting causes of action against certain agents for
29insolvency of certain entities under certain
30circumstances; providing definitions; amending s.
31626.9611, F.S.; requiring that the department and
32Financial Services Commission adopt rules prohibiting the
33use of unfair and deceptive practices in the sale of
34insurance to members of the United States Armed Forces;
35providing limitations; providing an appropriation;
36providing effective dates.
37
38Be It Enacted by the Legislature of the State of Florida:
39
40     Section 1.  Paragraph (a) of subsection (7) of section
41626.112, Florida Statutes, is amended to read:
42     626.112  License and appointment required; agents, customer
43representatives, adjusters, insurance agencies, service
44representatives, managing general agents.--
45     (7)(a)  Effective October 1, 2006, no individual, firm,
46partnership, corporation, association, or any other entity shall
47act in its own name or under a trade name, directly or
48indirectly, as an insurance agency, unless it complies with s.
49626.172 with respect to possessing an insurance agency license
50for each place of business at which it engages in any activity
51which may be performed only by a licensed insurance agent. Each
52agency engaged in business in this state before January 1, 2003,
53which is wholly owned by insurance agents currently licensed and
54appointed under this chapter, each incorporated agency whose
55voting shares are traded on a securities exchange, each agency
56designated and subject to supervision and inspection as a branch
57office under the rules of the National Association of Securities
58Dealers, and each agency whose primary function is offering
59insurance as a service or member benefit to members of a
60nonprofit corporation may file an application for registration
61in lieu of licensure in accordance with s. 626.172(3). Each
62agency engaged in business before October 1, 2006, shall file an
63application for licensure or registration on or before October
641, 2006.
65     1.  If an agency is required to be licensed but fails to
66file an application for licensure in accordance with this
67section, the department shall impose on the agency an
68administrative penalty in an amount of up to $10,000.
69     2.  If an agency is eligible for registration but fails to
70file an application for registration or an application for
71licensure in accordance with this section, the department shall
72impose on the agency an administrative penalty in an amount of
73up to $5,000.
74Section 2.  Paragraph (k) of subsection (2) of section
75626.221, Florida Statutes, is amended to read:
76     626.221  Examination requirement; exemptions.--
77     (2)  However, no such examination shall be necessary in any
78of the following cases:
79     (k)  An applicant for license as an independent or company
80employee adjuster who has the designation of Accredited Claims
81Adjuster (ACA) from a regionally accredited postsecondary
82institution in this state, Professional Claims Adjuster (PCA)
83from the Professional Career Institute, Professional Property
84Insurance Adjuster (PPIA) from the HurriClaim Training Academy,
85Certified Adjuster (CA) from ALL LINES Training, or Certified
86Claims Adjuster (CCA) from the Association of Property and
87Casualty Claims Professionals whose curriculum has been approved
88by the department and whose curriculum includes comprehensive
89analysis of basic property and casualty lines of insurance and
90testing at least equal to that of standard department testing
91for the all-lines adjuster license. The department shall adopt
92rules establishing standards for the approval of curriculum.
93     Section 2.  Subsection (2) of section 626.7851, Florida
94Statutes, is amended to read:
95     626.7851  Requirement as to knowledge, experience, or
96instruction.--No applicant for a license as a life agent, except
97for a chartered life underwriter (CLU), shall be qualified or
98licensed unless within the 4 years immediately preceding the
99date the application for a license is filed with the department
100he or she has:
101     (2)  Successfully completed a correspondence course in
102insurance, 3 hours of which shall be on the subject matter of
103ethics, satisfactory to the department and regularly offered by
104accredited institutions of higher learning in this state or by
105independent programs of study, approved by the department.
106Courses must include instruction on the subject matter of
107unauthorized entities engaging in the business of insurance, to
108include the Florida Nonprofit Multiple-Employer Welfare
109Arrangement Act and the Employee Retirement Income Security Act,
11029 U.S.C. ss. 1001 et seq., as it relates to the provision of
111life insurance by employers to their employees and the
112regulation thereof;
113     Section 3.  Subsection (2) of section 626.8311, Florida
114Statutes, is amended to read:
115     626.8311  Requirement as to knowledge, experience, or
116instruction.--No applicant for a license as a health agent,
117except for a chartered life underwriter (CLU), shall be
118qualified or licensed unless within the 4 years immediately
119preceding the date the application for license is filed with the
120department he or she has:
121     (2)  Successfully completed a correspondence course in
122insurance, 3 hours of which shall be on the subject matter of
123ethics, satisfactory to the department and regularly offered by
124accredited institutions of higher learning in this state or by
125independent programs of study, approved by the department.
126Courses must include instruction on the subject matter of
127unauthorized entities engaging in the business of insurance, to
128include the Florida Nonprofit Multiple-Employer Welfare
129Arrangement Act and the Employee Retirement Income Security Act,
13029 U.S.C. ss. 1001 et seq., as it relates to the provision of
131health insurance by employers to their employees and the
132regulation thereof;
133     Section 4.  Effective January 1, 2008, subsection (1) of
134section 626.747, Florida Statutes, is amended to read:
135     626.747  Branch agencies.--
136     (1)(a)  Each branch place of business established by an
137agent or agency, firm, corporation, or association shall be in
138the active full-time charge of a licensed general lines agent or
139life or health agent who is appointed to represent one or more
140insurers. Any agent or agency, firm, corporation, or association
141which has established one or more branch places of business
142shall be required to have at least one licensed general lines
143agent who is appointed to represent one or more insurers at each
144location of the agency including its headquarters location.
145     (b)  Notwithstanding paragraph (a), the licensed agent in
146charge of an insurance agency may also be the agent in charge of
147additional branch office locations of the agency if insurance
148activities requiring licensure as an insurance agent do not
149occur at any location when the agent is not physically present
150and unlicensed employees at the location do not engage in any
151insurance activities requiring licensure as an insurance agent
152or customer service representative.
153     Section 5.  Subsection (2) of section 626.865, Florida
154Statutes, is amended to read:
155     626.865  Public adjuster's qualifications, bond.--
156     (2)  At the time of application for license as a public
157adjuster, the applicant shall file with the department a bond
158executed and issued by a surety insurer authorized to transact
159such business in this state, in the amount of $50,000,
160conditioned for the faithful performance of his or her duties as
161a public adjuster under the license for which the applicant has
162applied, and thereafter maintain the bond unimpaired throughout
163the existence of the license and for at least 1 year after
164termination of the license for. The bond shall be in favor of
165the department and shall specifically authorize recovery by the
166department of the damages sustained in case the licensee is
167guilty of fraud or unfair practices in connection with his or
168her business as public adjuster. The aggregate liability of the
169surety for all such damages shall in no event exceed the amount
170of the bond.  Such bond shall not be terminated unless at least
17130 days' written notice is given to the licensee and filed with
172the department.
173     Section 6.  Paragraph (c) of subsection (4) of section
174626.869, Florida Statutes, is amended to read:
175     626.869  License, adjusters.--
176     (4)
177     (c)  The department shall adopt rules necessary to
178implement and administer the continuing education requirements
179of this subsection. For good cause shown, the department may
180grant an extension of time during which the requirements imposed
181by this section may be completed, but such extension of time may
182not exceed 1 year.
183     Section 7.  Subsection (1) of section 626.8698, Florida
184Statutes, is amended to read:
185     626.8698  Disciplinary guidelines for public
186adjusters.--The department may deny, suspend, or revoke the
187license of a public adjuster, and administer a fine not to
188exceed $5,000 per act, for any of the following:
189     (1)  Violating any provision of this chapter or a rule or
190order of the department office or commission;
191     Section 8.  Paragraphs (a) and (c) of section 626.921,
192Florida Statutes, are amended to read:
193     626.921  Florida Surplus Lines Service Office.--
194     (5)(a)  The association shall submit to the office a plan
195of operation, and any amendments thereto, to provide operating
196procedures for the administration of the service office. The
197plan of operation and any amendments thereto shall become
198effective upon approval by order of the office. The association
199shall submit to the department an agents' manual, and any
200amendments thereto, which shall provide administrative
201procedures that surplus lines insurance agents must follow with
202respect to their duties to the service office. The manual shall
203be prepared in cooperation with the department, and any changes,
204updates, or amendments shall be submitted to the department
205before distribution. The manual shall be approved by order of
206the department.
207     (c)  All surplus lines agents licensed in this state must
208comply with the plan of operation and the agent's manual.
209     Section 9.  Section 626.9531, Florida Statutes, is amended
210to read:
211     626.9531  Identification of insurers, agents, and insurance
212contracts.--
213     (1)  Advertising materials and other communications
214developed by insurers, or other risk bearing entities authorized
215under this code and approved by the office to do business in
216this state, regarding insurance products shall clearly indicate
217that the communication relates to insurance products. When
218soliciting or selling insurance products, agents shall clearly
219indicate to prospective insureds that they are acting as
220insurance agents with regard to insurance products and
221identified insurers, or other risk bearing entities authorized
222under this code and approved by the office to do business in
223this state.
224     (2)  There shall be no liability on the part of, and no
225cause of action of any nature shall arise against, any licensed
226and appointed insurance agent for the insolvency of any risk
227bearing entity when such entity has been duly authorized or
228approved by the office to do business in this state. However if
229the licensed and appointed agent was a controlling producer, as
230defined in s. 626.7491(2), of the risk bearing entity within 2
231years preceding the insolvency, the agent is subject to penalty
232as provided in s. 626.7491(8).
233     (3)  For the purposes of this section, the term "risk
234bearing entity" means a reciprocal insurer as defined in s.
235629.021, a commercial self-insurance fund as defined in s.
236624.462, a group self-insurance fund as defined in s. 624.4621,
237a local government self-insurance fund as defined in s.
238624.4622, a self-insured public utility as defined in s.
239624.46225, or an independent educational institution self-
240insurance fund as defined in s. 624.4623. For the purposes of
241this section, the term "risk bearing entity" does not include an
242authorized insurer as defined in s. 624.09.
243     Section 10.  Section 626.9611, Florida Statutes, is amended
244to read:
245     626.9611  Rules.--
246     (1)  The department or commission may, in accordance with
247chapter 120, adopt reasonable rules as are necessary or proper
248to identify specific methods of competition or acts or practices
249which are prohibited by s. 626.9541 or s. 626.9551, but the
250rules shall not enlarge upon or extend the provisions of ss.
251626.9541 and 626.9551.
252     (2)  The department and the commission shall, in accordance
253with chapter 120, adopt rules to protect members of the United
254States Armed Forces from dishonest or predatory insurance sales
255practices by insurers and insurance agents. The rules shall
256identify specific false, misleading, deceptive, or unfair
257methods of competition, acts, or practices which are prohibited
258by s. 626.9541 or s. 626.9551. The rules shall be based upon
259model rules or model laws adopted by the National Association of
260Insurance Commissioners which identify certain insurance
261practices involving the solicitation or sale of insurance and
262annuities to members of the United States Armed Forces which are
263false, misleading, deceptive, or unfair.
264     Section 11.  For the 2007-2008 fiscal year, the sum of
265$132,000 in nonrecurring funds is appropriated from the
266Insurance Regulatory Trust Fund to the Department of Financial
267Services for computer system changes necessary to implement the
268provisions of s. 626.747, Florida Statutes.
269     Section 12.  Except as otherwise expressly provided in this
270act, this act shall take effect July 1, 2007.


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