Florida Senate - 2023 COMMITTEE AMENDMENT
Bill No. CS for SB 1398
Ì932278EÎ932278
LEGISLATIVE ACTION
Senate . House
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The Appropriations Committee on Agriculture, Environment, and
General Government (DiCeglie) recommended the following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Present subsections (35) through (38) of section
6 494.001, Florida Statutes, are redesignated as subsections (36)
7 through (39), respectively, a new subsection (35) is added to
8 that section, and subsection (3) of that section is amended, to
9 read:
10 494.001 Definitions.—As used in this chapter, the term:
11 (3) “Branch office” means a location, other than a mortgage
12 broker’s or mortgage lender’s principal place of business or
13 remote location:
14 (a) The address of which appears on business cards,
15 stationery, or advertising used by the licensee in connection
16 with business conducted under this chapter;
17 (b) At which the licensee’s name, advertising or
18 promotional materials, or signage suggests that mortgage loans
19 are originated, negotiated, funded, or serviced; or
20 (c) At which mortgage loans are originated, negotiated,
21 funded, or serviced by a licensee.
22 (35) “Remote location” means a location, other than a
23 principal place of business or a branch office, at which a loan
24 originator of a licensee may conduct business. A licensee may
25 allow loan originators to work from remote locations if:
26 (a) The licensee has written policies and procedures for
27 supervision of loan originators working from remote locations.
28 (b) Access to company platforms and customer information is
29 in accordance with the licensee’s comprehensive written
30 information security plan.
31 (c) An in-person customer interaction does not occur at a
32 loan originator’s residence unless such residence is a licensed
33 location.
34 (d) Physical records are not maintained at a remote
35 location.
36 (e) Customer interactions and conversations about consumers
37 will be in compliance with federal and state information
38 security requirements, including applicable provisions under the
39 Gramm-Leach-Bliley Act and the Safeguards Rule established by
40 the Federal Trade Commission, set forth at 16 C.F.R. part 314,
41 as such requirements may be amended from time to time.
42 (f) A loan originator working at a remote location accesses
43 the company’s secure systems or documents, including a cloud
44 based system, directly from any out-of-office device such as a
45 laptop, phone, desktop computer, or tablet, through a virtual
46 private network or system that ensures secure connectivity and
47 that requires passwords or other forms of authentication to
48 access.
49 (g) The licensee ensures that appropriate security updates,
50 patches, or other alterations to the security of all devices
51 used at remote locations are installed and maintained.
52 (h) The licensee is able to remotely lock or erase company
53 related contents of any device or otherwise remotely limit all
54 access to a company’s secure systems.
55 (i) The registry’s record of a loan originator who works
56 from a remote location designates the principal place of
57 business as the loan originator’s registered location, or the
58 loan originator has elected a licensed branch office as a
59 registered location.
60 Section 2. Subsection (1) of section 494.0067, Florida
61 Statutes, is amended to read:
62 494.0067 Requirements of mortgage lenders.—
63 (1) A mortgage lender that makes mortgage loans on real
64 estate in this state shall transact business from a principal
65 place of business, branch office, or remote location. Each
66 principal place of business, and each branch office, and remote
67 location shall be operated under the full charge, control, and
68 supervision of the licensee pursuant to this part.
69 Section 3. Section 501.2042, Florida Statutes, is created
70 to read:
71 501.2042 Unlawful acts and practices by online crowd
72 funding campaigns.—
73 (1) As used in this section, the term:
74 (a) “Crowd-funding campaign” means an online fundraising
75 initiative that is intended to receive monetary donations from
76 donors and is created by an organizer in the interest of a
77 beneficiary.
78 (b) “Crowd-funding platform” means an entity doing business
79 in this state which provides an online medium for the creation
80 and facilitation of a crowd-funding campaign.
81 (c) “Disaster” has the same meaning as in s. 252.34(2).
82 (d) “Organizer” means a person who:
83 1. Resides or is domiciled in this state; and
84 2. Has an account on a crowd-funding platform and has
85 created a crowd-funding campaign either as a beneficiary or on
86 behalf of a beneficiary, regardless of whether the beneficiary
87 or the crowd-funding campaign has received donations.
88 (2) For crowd-funding campaigns related to and arising out
89 of a declared disaster, a crowd-funding platform must:
90 (a) Collect and retain, for one year after the date of the
91 declared disaster, the name, e-mail address, phone number, and
92 state of residence of the organizer.
93 (b) Require the organizer to indicate, on the crowd-funding
94 campaign, the state in which they are located.
95 (c) Cooperate with any investigation by or in partnership
96 with law enforcement.
97 (d) Clearly display and direct donors to fundraisers that
98 comply with the crowd-funding platform’s terms of service.
99 (3) When an organizer arranges a crowd-funding campaign
100 related to and arising out of a declared disaster, the organizer
101 must attest that:
102 (a) All information provided in connection with a crowd
103 funding campaign is accurate, complete, and not likely to
104 deceive users.
105 (b) All donations contributed to the crowd-funding campaign
106 will be used solely as described in the materials the organizer
107 posts or provides on the crowd-funding platform.
108 Section 4. Section 520.23, Florida Statutes, is amended to
109 read:
110 520.23 Disclosures required.—Each agreement governing the
111 sale or lease of a distributed energy generation system shall,
112 at a minimum, include a written statement printed in at least
113 12-point type that is separate from the agreement, is separately
114 acknowledged by the buyer or lessee, and includes the following
115 information and disclosures, if applicable:
116 (1) The name, address, telephone number, and e-mail address
117 of the buyer or lessee.
118 (2) The name, address, telephone number, e-mail address,
119 and valid state contractor license number of the person
120 responsible for installing the distributed energy generation
121 system.
122 (3) The name, address, telephone number, e-mail address,
123 and valid state contractor license number of the distributed
124 energy generation system maintenance provider, if different from
125 the person responsible for installing the distributed energy
126 generation system.
127 (4) The customer contact center phone number for the
128 Department of Business and Professional Regulation.
129 (5)(4) A written statement indicating whether the
130 distributed energy generation system is being purchased or
131 leased.
132 (a) If the distributed energy generation system will be
133 leased, the written statement must include a disclosure in
134 substantially the following form: “You are entering into an
135 agreement to lease a distributed energy generation system. You
136 will lease (not own) the system installed on your property.”
137 (b) If the distributed energy generation system will be
138 purchased, the written statement must include a disclosure in
139 substantially the following form: “You are entering into an
140 agreement to purchase a distributed energy generation system.
141 You will own (not lease) the system installed on your property.”
142 (6)(5) The total cost to be paid by the buyer or lessee,
143 including any interest, installation fees, document preparation
144 fees, service fees, or other fees.
145 (7)(6) A payment schedule, including any amounts owed at
146 contract signing, at the commencement of installation, at the
147 completion of installation, and any final payments. If the
148 distributed energy generation system is being leased, the
149 written statement must include the frequency and amount of each
150 payment due under the lease and the total estimated lease
151 payments over the term of the lease.
152 (8)(7) Each state or federal tax incentive or rebate, if
153 any, relied upon by the seller in determining the price of the
154 distributed energy generation system.
155 (9)(8) A description of the assumptions used to calculate
156 any savings estimates provided to the buyer or lessee, and if
157 such estimates are provided, a statement in substantially the
158 following form: “It is important to understand that future
159 electric utility rates are estimates only. Your future electric
160 utility rates may vary.”
161 (10)(9) A description of any one-time or recurring fees,
162 including, but not limited to, estimated system removal fees,
163 maintenance fees, Internet connection fees, and automated
164 clearinghouse fees. If late fees may apply, the description must
165 describe the circumstances triggering such late fees.
166 (11)(10) A statement notifying the buyer whether the
167 distributed energy generation system is being financed and, if
168 so, a statement in substantially the following form: “If your
169 system is financed, carefully read any agreements and/or
170 disclosure forms provided by your lender. This statement does
171 not contain the terms of your financing agreement. If you have
172 any questions about your financing agreement, contact your
173 finance provider before signing a contract.”
174 (12)(11) A statement notifying the buyer whether the seller
175 is assisting in arranging financing of the distributed energy
176 generation system and, if so, a statement in substantially the
177 following form: “If your system is financed, carefully read any
178 agreements and/or disclosure forms provided by your lender. This
179 statement does not contain the terms of your financing
180 agreement. If you have any questions about your financing
181 agreement, contact your finance provider before signing a
182 contract.”
183 (13)(12) A provision notifying the buyer or lessee of the
184 right to rescind the agreement for a period of at least 3
185 business days after the agreement is signed. This subsection
186 does not apply to a contract to sell or lease a distributed
187 energy generation system in a solar community in which the
188 entire community has been marketed as a solar community and all
189 of the homes in the community are intended to have a distributed
190 energy generation system, or a solar community in which the
191 developer has incorporated solar technology for purposes of
192 meeting the Florida Building Code in s. 553.73.
193 (14)(13) A description of the distributed energy generation
194 system design assumptions, including the make and model of the
195 major components, system size, estimated first-year energy
196 production, and estimated annual energy production decreases,
197 including the overall percentage degradation over the estimated
198 life of the distributed energy generation system, and the status
199 of utility compensation for excess energy generated by the
200 system at the time of contract signing. A seller who provides a
201 warranty or guarantee of the energy production output of the
202 distributed energy generation system may provide a description
203 of such warranty or guarantee in lieu of a description of the
204 system design and components.
205 (15)(14) A description of any performance or production
206 guarantees.
207 (16)(15) A description of the ownership and transferability
208 of any tax credits, rebates, incentives, or renewable energy
209 certificates associated with the distributed energy generation
210 system, including a disclosure as to whether the seller will
211 assign or sell any associated renewable energy certificates to a
212 third party.
213 (17)(16) A statement in substantially the following form:
214 “You are responsible for property taxes on property you own.
215 Consult a tax professional to understand any tax liability or
216 eligibility for any tax credits that may result from the
217 purchase of your distributed energy generation system.”
218 (18)(17) The approximate start and completion dates for the
219 installation of the distributed energy generation system.
220 (19)(18) A disclosure as to whether maintenance and repairs
221 of the distributed energy generation system are included in the
222 purchase price.
223 (20)(19) A disclosure as to whether any warranty or
224 maintenance obligations related to the distributed energy
225 generation system may be sold or transferred by the seller to a
226 third party and, if so, a statement in substantially the
227 following form: “Your contract may be assigned, sold, or
228 transferred without your consent to a third party who will be
229 bound to all the terms of the contract. If a transfer occurs,
230 you will be notified if this will change the address or phone
231 number to use for system maintenance or repair requests.”
232 (21)(20) If the distributed energy generation system will
233 be purchased, a disclosure notifying the buyer of the
234 requirements for interconnecting the system to the utility
235 system.
236 (22)(21) A disclosure notifying the buyer or lessee of the
237 party responsible for obtaining interconnection approval.
238 (23)(22) A description of any roof warranties.
239 (24) A statement in substantially the following form: “You
240 should consider the age and remaining life of your roof prior to
241 installing a distributed energy generation system. Replacement
242 of your roof may require reinstallment of the distributed energy
243 generation system.”
244 (25)(23) A disclosure notifying the lessee whether the
245 seller will insure a leased distributed energy generation system
246 against damage or loss and, if applicable, the circumstances
247 under which the seller will not insure the system against damage
248 or loss.
249 (26)(24) A statement, if applicable, in substantially the
250 following form: “You are responsible for obtaining insurance
251 policies or coverage for any loss of or damage to the system.
252 Consult an insurance professional to understand how to protect
253 against the risk of loss or damage to the system.”
254 (27) A statement in substantially the following form:
255 “Placing a distributed energy generation system on your roof may
256 impact your future insurance premiums. You are responsible for
257 contacting your insurance carrier, prior to entering into a
258 purchase or lease agreement, to confirm whether your current
259 policy or coverage will need to be modified upon installing the
260 distributed energy generation system onto your dwelling.”
261 (28)(25) A disclosure notifying the buyer or lessee whether
262 the seller or lessor will place a lien on the buyer’s or
263 lessee’s home or other property as a result of entering into a
264 purchase or lease agreement for the distributed energy
265 generation system.
266 (29)(26) A disclosure notifying the buyer or lessee whether
267 the seller or lessor will file a fixture filing or a State of
268 Florida Uniform Commercial Code Financing Statement Form (UCC-1)
269 on the distributed energy generation system.
270 (30)(27) A disclosure identifying whether the agreement
271 contains any restrictions on the buyer’s or lessee’s ability to
272 modify or transfer ownership of a distributed energy generation
273 system, including whether any modification or transfer is
274 subject to review or approval by a third party.
275 (31)(28) A disclosure as to whether the lease agreement may
276 be transferred to a purchaser upon sale of the home or real
277 property to which the system is affixed, and any conditions for
278 such transfer.
279 (32)(29) A blank section that allows the seller to provide
280 additional relevant disclosures or explain disclosures made
281 elsewhere in the disclosure form.
282
283 The requirement to provide a written statement under this
284 section may be satisfied by the electronic delivery of a
285 document within 24 hours after execution of the written
286 statement containing the required statement if the intended
287 recipient of the electronic document affirmatively acknowledges
288 its receipt. An electronic document satisfies the font and other
289 formatting standards required for the written statement if the
290 format and the relative size of characters of the electronic
291 document are reasonably similar to those required in the written
292 document or if the information is otherwise displayed in a
293 reasonably conspicuous manner.
294 Section 5. Subsection (6) of section 560.111, Florida
295 Statutes, is amended to read:
296 560.111 Prohibited acts.—
297 (6) A person who knowingly and willfully violates s.
298 560.309(11) or s. 560.310(2)(d) commits a felony of the third
299 degree, punishable as provided in s. 775.082, s. 775.083, or s.
300 775.084.
301 Section 6. Subsection (11) is added to section 560.309,
302 Florida Statutes, to read:
303 560.309 Conduct of business.—
304 (11) A licensee may not cash corporate checks where the
305 aggregate face amount of all corporate checks cashed for each
306 payee exceeds 200 percent of the payee’s workers’ compensation
307 policy payroll amount during the same dates as the workers’
308 compensation policy coverage period.
309 Section 7. Section 626.602, Florida Statutes, is amended to
310 read:
311 626.602 Insurance agency and adjusting firm names;
312 disapproval.—The department may disapprove the use of any true
313 or fictitious name, other than the bona fide natural name of an
314 individual, by any insurance agency or adjusting firm on any of
315 the following grounds:
316 (1) The name interferes with or is too similar to a name
317 already filed and in use by another agency, adjusting firm, or
318 insurer.
319 (2)The use of the name may mislead the public in any
320 respect.
321 (3) The name states or implies that the agency or adjusting
322 firm is an insurer, motor club, hospital service plan, state or
323 federal agency, charitable organization, or entity that
324 primarily provides advice and counsel rather than sells or
325 solicits insurance, settles claims, or is entitled to engage in
326 insurance activities not permitted under licenses held or
327 applied for. This provision does not prohibit the use of the
328 word “state” or “states” in the name of the agency. The use of
329 the word “state” or “states” in the name of an agency or
330 adjusting firm does not in and of itself imply that the agency
331 or adjusting firm is a state agency.
332 (4) The name contains the word “Medicare” or “Medicaid.” An
333 insurance agency whose name contains the word “Medicare” or
334 “Medicaid” but which is licensed as of July 1, 2021, may
335 continue to use that name until June 30, 2023, provided that the
336 agency’s license remains valid. If the agency’s license expires
337 or is suspended or revoked, the agency may not be relicensed
338 using that name. Licenses for agencies with names containing
339 either of these words automatically expire on July 1, 2023,
340 unless these words are removed from the name.
341 Section 8. Section 626.854, Florida Statutes, is amended to
342 read:
343 626.854 “Public adjuster” defined; prohibitions.—The
344 Legislature finds that it is necessary for the protection of the
345 public to regulate public insurance adjusters and to prevent the
346 unauthorized practice of law.
347 (1) A “public adjuster” is any person, except a duly
348 licensed attorney at law as exempted under s. 626.860, who, for
349 money, commission, or any other thing of value, directly or
350 indirectly prepares, completes, or files an insurance claim for
351 an insured or third-party claimant, regardless of how that
352 person describes or presents his or her services, or who, for
353 money, commission, or any other thing of value, acts on behalf
354 of, or aids an insured or third-party claimant in negotiating
355 for or effecting the settlement of a claim or claims for loss or
356 damage covered by an insurance contract, regardless of how that
357 person describes or presents his or her services, or who
358 advertises for employment as an adjuster of such claims. The
359 term also includes any person who, for money, commission, or any
360 other thing of value, directly or indirectly solicits,
361 investigates, or adjusts such claims on behalf of a public
362 adjuster, an insured, or a third-party claimant. The term does
363 not include a person who photographs or inventories damaged
364 personal property or business personal property or a person
365 performing duties under another professional license, if such
366 person does not otherwise solicit, adjust, investigate, or
367 negotiate for or attempt to effect the settlement of a claim.
368 (2) This definition does not apply to:
369 (a) A licensed health care provider or employee thereof who
370 prepares or files a health insurance claim form on behalf of a
371 patient.
372 (b) A licensed health insurance agent who assists an
373 insured with coverage questions, medical procedure coding
374 issues, balance billing issues, understanding the claims filing
375 process, or filing a claim, as such assistance relates to
376 coverage under a health insurance policy.
377 (c) A person who files a health claim on behalf of another
378 and does so without compensation.
379 (3) A public adjuster may not give legal advice or act on
380 behalf of or aid any person in negotiating or settling a claim
381 relating to bodily injury, death, or noneconomic damages.
382 (4) For purposes of this section, the term “insured”
383 includes only the policyholder and any beneficiaries named or
384 similarly identified in the policy.
385 (5) A public adjuster may not directly or indirectly
386 through any other person or entity solicit an insured or
387 claimant by any means except on Monday through Saturday of each
388 week and only between the hours of 8 a.m. and 8 p.m. on those
389 days.
390 (6) When entering a contract for adjuster services after
391 July 1, 2023, a public adjuster:
392 (a) May not collect a fee for services on payments made to
393 a named insured unless they have a written contract with the
394 named insured or the named insured’s legal representative.
395 (b) May not contract for services to be provided by a third
396 party on behalf of the named insured or in pursuit of settlement
397 of the named insureds claim, if the cost of those services is to
398 be borne by the named insured, unless the named insured agrees
399 in writing to procure these services and such agreement is
400 entered into subsequent to the date of the contract for public
401 adjusting services.
402 (c) If a public adjuster contracts with a third-party
403 service provider to assist with the settlement of the named
404 insured’s claim, without first obtaining the insured’s written
405 consent, payment of the third party’s fees must be made by the
406 public adjuster and may not be charged back to the named
407 insured.
408 (d) If a public adjuster represents anyone other than the
409 named insured in a claim, the public adjuster fees shall be paid
410 by the third party and may not be charged back to the named
411 insured.
412 (7)(6) An insured or claimant may cancel a public
413 adjuster’s contract to adjust a claim without penalty or
414 obligation within 10 days after the date on which the contract
415 is executed. If the contract was entered into based on events
416 that are the subject of a declaration of a state of emergency by
417 the Governor, an insured or claimant may cancel the public
418 adjuster’s contract to adjust a claim without penalty or
419 obligation within 30 days after the date of loss or 10 days
420 after the date on which the contract is executed, whichever is
421 longer. The public adjuster’s contract must contain the
422 following language in minimum 18-point bold type immediately
423 before the space reserved in the contract for the signature of
424 the insured or claimant: “You, the insured, may cancel this
425 contract for any reason without penalty or obligation to you
426 within 10 days after the date of this contract. If this contract
427 was entered into based on events that are the subject of a
428 declaration of a state of emergency by the Governor, you may
429 cancel this contract for any reason without penalty or
430 obligation to you within 30 days after the date of loss or 10
431 days after the date on which the contract is executed, whichever
432 is longer. You may also cancel the contract without penalty or
433 obligation to you if I, as your public adjuster, fail to provide
434 you and your insurer a copy of a written estimate within 60 days
435 of the execution of the contract, unless the failure to provide
436 the estimate within 60 days is caused by factors beyond my
437 control, in accordance with s. 626.854(14)(b), Florida Statutes.
438 The 60-day cancellation period for failure to provide a written
439 estimate shall cease on the date I have provided you with the
440 written estimate.” The by providing notice of cancellation shall
441 be provided to ...(name of public adjuster)..., submitted in
442 writing and sent by certified mail, return receipt requested, or
443 other form of mailing that provides proof thereof, at the
444 address specified in the contract.
445 (8)(7) It is an unfair and deceptive insurance trade
446 practice pursuant to s. 626.9541 for a public adjuster or any
447 other person to circulate or disseminate any advertisement,
448 announcement, or statement containing any assertion,
449 representation, or statement with respect to the business of
450 insurance which is untrue, deceptive, or misleading.
451 (a) The following statements, made in any public adjuster’s
452 advertisement or solicitation, are considered deceptive or
453 misleading:
454 1. A statement or representation that invites an insured
455 policyholder to submit a claim when the policyholder does not
456 have covered damage to insured property.
457 2. A statement or representation that invites an insured
458 policyholder to submit a claim by offering monetary or other
459 valuable inducement.
460 3. A statement or representation that invites an insured
461 policyholder to submit a claim by stating that there is “no
462 risk” to the policyholder by submitting such claim.
463 4. A statement or representation, or use of a logo or
464 shield, that implies or could mistakenly be construed to imply
465 that the solicitation was issued or distributed by a
466 governmental agency or is sanctioned or endorsed by a
467 governmental agency.
468 (b) For purposes of this paragraph, the term “written
469 advertisement” includes only newspapers, magazines, flyers, and
470 bulk mailers. The following disclaimer, which is not required to
471 be printed on standard size business cards, must be added in
472 bold print and capital letters in typeface no smaller than the
473 typeface of the body of the text to all written advertisements
474 by a public adjuster:
475
476 “THIS IS A SOLICITATION FOR BUSINESS. IF YOU HAVE HAD
477 A CLAIM FOR AN INSURED PROPERTY LOSS OR DAMAGE AND YOU
478 ARE SATISFIED WITH THE PAYMENT BY YOUR INSURER, YOU
479 MAY DISREGARD THIS ADVERTISEMENT.”
480
481 (9)(8) A public adjuster, a public adjuster apprentice, or
482 any person or entity acting on behalf of a public adjuster or
483 public adjuster apprentice may not give or offer to give a
484 monetary loan or advance to a client or prospective client.
485 (10)(9) A public adjuster, public adjuster apprentice, or
486 any individual or entity acting on behalf of a public adjuster
487 or public adjuster apprentice may not give or offer to give,
488 directly or indirectly, any article of merchandise having a
489 value in excess of $25 to any individual for the purpose of
490 advertising or as an inducement to entering into a contract with
491 a public adjuster.
492 (10)(11)(a) If a public adjuster enters into a contract
493 with an insured or claimant to reopen a claim or file a
494 supplemental claim that seeks additional payments for a claim
495 that has been previously paid in part or in full or settled by
496 the insurer, the public adjuster may not charge, agree to, or
497 accept from any source compensation, payment, commission, fee,
498 or any other thing of value based on a previous settlement or
499 previous claim payments by the insurer for the same cause of
500 loss. The charge, compensation, payment, commission, fee, or any
501 other thing of value must be based only on the claim payments or
502 settlements paid to the insured, exclusive of attorney fees and
503 costs, obtained through the work of the public adjuster after
504 entering into the contract with the insured or claimant.
505 Compensation for the reopened or supplemental claim may not
506 exceed 20 percent of the reopened or supplemental claim payment.
507 In no event shall the contracts described in this paragraph
508 exceed the limitations in paragraph (b).
509 (b) A public adjuster may not charge, agree to, or accept
510 from any source compensation, payment, commission, fee, or any
511 other thing of value in excess of:
512 1. Ten percent of the amount of insurance claim payments or
513 settlements, exclusive of attorney fees and costs, paid to the
514 insured by the insurer for claims based on events that are the
515 subject of a declaration of a state of emergency by the
516 Governor. This provision applies to claims made during the year
517 after the declaration of emergency. After that year, the
518 limitations in subparagraph 2. apply.
519 2. Twenty percent of the amount of insurance claim payments
520 or settlements, exclusive of attorney fees and costs, paid to
521 the insured by the insurer for claims that are not based on
522 events that are the subject of a declaration of a state of
523 emergency by the Governor.
524 3. One percent of the amount of insurance claim payments or
525 settlements, paid to the insured by the insurer for any coverage
526 part of the policy where the claim payment or written agreement
527 by the insurer to pay is equal to or greater than the policy
528 limit for that part of the policy, if the payment or written
529 commitment to pay is provided within 14 days after the date of
530 loss or within 10 days after the date on which the public
531 adjusting contract is executed, whichever is later.
532 4. Zero percent of the amount of insurance claim payments
533 or settlements, paid to the insured by the insurer for any
534 coverage part of the policy where the claim payment or written
535 agreement by the insurer to pay occurs before the date on which
536 the public adjusting contract is executed.
537 (c) Insurance claim payments made by the insurer do not
538 include policy deductibles, and public adjuster compensation may
539 not be based on the deductible portion of a claim.
540 (d) Public adjuster compensation may not be based on
541 amounts attributable to additional living expenses, unless such
542 compensation is affirmatively agreed to in a separate agreement
543 that includes a disclosure in substantially the following form:
544 “I agree to retain and compensate the public adjuster for
545 adjusting my additional living expenses and securing payment
546 from my insurer for amounts attributable to additional living
547 expenses payable under the policy issued on my (home/mobile
548 home/condominium unit).”
549 (e) Public adjuster rate of compensation may not be
550 increased based solely on the fact that the claim is litigated.
551 (f) Any maneuver, shift, or device through which the limits
552 on compensation set forth in this subsection are exceeded is a
553 violation of this chapter punishable as provided under s.
554 626.8698.
555 (12)(a)(11) Each public adjuster must provide to the
556 claimant or insured a written estimate of the loss to assist in
557 the submission of a proof of loss or any other claim for payment
558 of insurance proceeds within 60 days after the date of the
559 contract. The written estimate must include an itemized, per
560 unit estimate of the repairs, including itemized information on
561 equipment, materials, labor, and supplies, in accordance with
562 accepted industry standards. The public adjuster shall retain
563 such written estimate for at least 5 years and shall make the
564 estimate available to the claimant or insured, the insurer, and
565 the department upon request.
566 (b) An insured may cancel the contract with no additional
567 penalties or fees charged by the public adjuster if such an
568 estimate is not provided within 60 days after executing the
569 contract, subject to the cancellation notice requirement in this
570 section, unless the failure to provide the estimate within 60
571 days is caused by factors beyond the control of the public
572 adjuster. The cancellation period shall cease on the date the
573 public adjuster provides the written estimate to the insured.
574 (13)(12) A public adjuster, public adjuster apprentice, or
575 any person acting on behalf of a public adjuster or apprentice
576 may not accept referrals of business from any person with whom
577 the public adjuster conducts business if there is any form or
578 manner of agreement to compensate the person, directly or
579 indirectly, for referring business to the public adjuster. A
580 public adjuster may not compensate any person, except for
581 another public adjuster, directly or indirectly, for the
582 principal purpose of referring business to the public adjuster.
583 (14)(13) A company employee adjuster, independent adjuster,
584 attorney, investigator, or other persons acting on behalf of an
585 insurer that needs access to an insured or claimant or to the
586 insured property that is the subject of a claim must provide at
587 least 48 hours’ notice to the insured or claimant, public
588 adjuster, or legal representative before scheduling a meeting
589 with the claimant or an onsite inspection of the insured
590 property. The insured or claimant may deny access to the
591 property if the notice has not been provided. The insured or
592 claimant may waive the 48-hour notice.
593 (15)(14) The public adjuster must ensure that prompt notice
594 is given of the claim to the insurer, the public adjuster’s
595 contract is provided to the insurer, the property is available
596 for inspection of the loss or damage by the insurer, and the
597 insurer is given an opportunity to interview the insured
598 directly about the loss and claim. The insurer must be allowed
599 to obtain necessary information to investigate and respond to
600 the claim.
601 (a) The insurer may not exclude the public adjuster from
602 its in-person meetings with the insured. The insurer shall meet
603 or communicate with the public adjuster in an effort to reach
604 agreement as to the scope of the covered loss under the
605 insurance policy. The public adjuster shall meet or communicate
606 with the insurer in an effort to reach agreement as to the scope
607 of the covered loss under the insurance policy. This section
608 does not impair the terms and conditions of the insurance policy
609 in effect at the time the claim is filed.
610 (b) A public adjuster may not restrict or prevent an
611 insurer, company employee adjuster, independent adjuster,
612 attorney, investigator, or other person acting on behalf of the
613 insurer from having reasonable access at reasonable times to any
614 insured or claimant or to the insured property that is the
615 subject of a claim.
616 (c) A public adjuster may not act or fail to reasonably act
617 in any manner that obstructs or prevents an insurer or insurer’s
618 adjuster from timely conducting an inspection of any part of the
619 insured property for which there is a claim for loss or damage.
620 The public adjuster representing the insureds may be present for
621 the insurer’s inspection, but if the unavailability of the
622 public adjuster otherwise delays the insurer’s timely inspection
623 of the property, the public adjuster or the insureds must allow
624 the insurer to have access to the property without the
625 participation or presence of the public adjuster or insureds in
626 order to facilitate the insurer’s prompt inspection of the loss
627 or damage.
628 (16)(15) A licensed contractor under part I of chapter 489,
629 or a subcontractor of such licensee, may not advertise, solicit,
630 offer to handle, handle, or perform public adjuster services as
631 provided in subsection (1) unless licensed and compliant as a
632 public adjuster under this chapter. The prohibition against
633 solicitation does not preclude a contractor from suggesting or
634 otherwise recommending to a consumer that the consumer consider
635 contacting his or her insurer to determine if the proposed
636 repair is covered under the consumer’s insurance policy, except
637 as it relates to solicitation prohibited in s. 489.147. In
638 addition, the contractor may discuss or explain a bid for
639 construction or repair of covered property with the residential
640 property owner who has suffered loss or damage covered by a
641 property insurance policy, or the insurer of such property, if
642 the contractor is doing so for the usual and customary fees
643 applicable to the work to be performed as stated in the contract
644 between the contractor and the insured.
645 (17)(16) A public adjuster shall not acquire any interest
646 in salvaged property, except with the written consent and
647 permission of the insured through a signed affidavit.
648 (18)(17) A public adjuster, a public adjuster apprentice,
649 or a person acting on behalf of an adjuster or apprentice may
650 not enter into a contract or accept a power of attorney that
651 vests in the public adjuster, the public adjuster apprentice, or
652 the person acting on behalf of the adjuster or apprentice the
653 effective authority to choose the persons or entities that will
654 perform repair work in a property insurance claim or provide
655 goods or services that will require the insured or third-party
656 claimant to expend funds in excess of those payable to the
657 public adjuster under the terms of the contract for adjusting
658 services.
659 (19)(18) Subsections (5)-(18) (5)-(17) apply only to
660 residential property insurance policies and condominium unit
661 owner policies as described in s. 718.111(11).
662 (20)(19) Except as otherwise provided in this chapter, no
663 person, except an attorney at law or a licensed public adjuster,
664 may for money, commission, or any other thing of value, directly
665 or indirectly:
666 (a) Prepare, complete, or file an insurance claim for an
667 insured or a third-party claimant;
668 (b) Act on behalf of or aid an insured or a third-party
669 claimant in negotiating for or effecting the settlement of a
670 claim for loss or damage covered by an insurance contract;
671 (c) Offer to initiate or negotiate a claim on behalf of an
672 insured;
673 (d) Advertise services that require a license as a public
674 adjuster; or
675 (e) Solicit, investigate, or adjust a claim on behalf of a
676 public adjuster, an insured, or a third-party claimant.
677 (21)(20) The department may take administrative actions and
678 impose fines against any persons performing claims adjusting,
679 soliciting, or any other services described in this section
680 without the licensure required under this section or s. 626.112.
681 (22)(21) A public adjuster, public adjuster apprentice, or
682 public adjusting firm that solicits a claim and does not enter
683 into a contract with an insured or a third-party claimant
684 pursuant to paragraph (11)(a) (10)(a) may not charge an insured
685 or a third-party claimant or receive payment by any other source
686 for any type of service related to the insured or third-party
687 claimant’s claim.
688 (23)(a)(22)(a) Any following act by a public adjuster, a
689 public adjuster apprentice, or a person acting on behalf of a
690 public adjuster or public adjuster apprentice is prohibited and
691 shall result in discipline as applicable under this part:
692 1. Offering to a residential property owner a rebate, gift,
693 gift card, cash, coupon, waiver of any insurance deductible, or
694 any other thing of value in exchange for:
695 a. Allowing a contractor, a public adjuster, a public
696 adjuster apprentice, or a person acting on behalf of a public
697 adjuster or public adjuster apprentice to conduct an inspection
698 of the residential property owner’s roof; or
699 b. Making an insurance claim for damage to the residential
700 property owner’s roof.
701 2. Offering, delivering, receiving, or accepting any
702 compensation, inducement, or reward for the referral of any
703 services for which property insurance proceeds would be used for
704 roofing repairs or replacement.
705 (b) Notwithstanding the fine set forth in s. 626.8698, a
706 public adjuster or public adjuster apprentice may be subject to
707 a fine not to exceed $10,000 per act for a violation of this
708 subsection and a fine not to exceed $20,000 per act for a
709 violation of this subsection that occurs during a state of
710 emergency declared by executive order or proclamation of the
711 Governor pursuant to s. 252.36.
712 (c) A person who engages in an act prohibited by this
713 subsection and who is not a public adjuster or a public adjuster
714 apprentice, or is not otherwise exempt from licensure, is guilty
715 of the unlicensed practice of public adjusting and may be:
716 1. Subject to all applicable penalties set forth in this
717 part.
718 2. Notwithstanding subparagraph 1., subject to a fine not
719 to exceed $10,000 per act for a violation of this subsection and
720 a fine not to exceed $20,000 per act for a violation of this
721 subsection that occurs during a state of emergency declared by
722 executive order or proclamation of the Governor pursuant to s.
723 252.36.
724 Section 9. Section 626.860, Florida Statutes, is amended to
725 read:
726 626.860 Attorneys at law; exemption.—Attorneys at law duly
727 licensed to practice law in the courts of this state, and in
728 good standing with The Florida Bar, shall not be required to be
729 licensed under the provisions of this code to authorize them to
730 adjust or participate in the adjustment of any claim, loss, or
731 damage arising under policies or contracts of insurance. This
732 exemption does not extend to the employees, interns, volunteers,
733 or contractors of an attorney or of a law firm.
734 Section 10. Section 626.875, Florida Statutes, is amended
735 to read:
736 626.875 Office and records.—
737 (1)(a) Each appointed independent adjuster and licensed
738 public adjuster must maintain a place of business in this state
739 which is accessible to the public and keep therein the usual and
740 customary records pertaining to transactions under the license.
741 This provision does not prohibit maintenance of such an office
742 in the home of the licensee.
743 (b) A license issued under this chapter must at all times
744 be posted in a conspicuous place in the principal place of
745 business of the license holder. If the licensee is conducting
746 business away from the place of business such that the license
747 cannot be posted, the licensee shall have such license in his or
748 her actual possession at the time of carrying on such business.
749 (2) The records of the adjuster relating to a particular
750 claim or loss shall be so retained in the adjuster’s place of
751 business for a period of not less than 5 years after completion
752 of the adjustment and shall be available for inspection by the
753 department between the hours of 8 a.m. and 5 p.m., Monday
754 through Friday, excluding state holidays. This provision shall
755 not be deemed to prohibit return or delivery to the insurer or
756 insured of documents furnished to or prepared by the adjuster
757 and required by the insurer or insured to be returned or
758 delivered thereto. At a minimum, the following records must be
759 maintained for a period of not less than 5 years:
760 (a) Name, address, telephone number, and e-mail address of
761 the insured, and the name of the attorney representing the
762 insured, if applicable.
763 (b) The date, location, and amount of the loss.
764 (c) An unaltered copy of the executed disclosure document
765 required by s. 626.8796.
766 (d) An unaltered copy of the executed public adjuster
767 contract required by s. 626.8796.
768 (e) A copy of the estimate of damages provided to the
769 insurer.
770 (f) The name of the insurer; the name of the claims
771 representative of the insurer; and the amount, expiration date,
772 and number of each policy under which the loss is covered.
773 (g) An itemized statement of the recoveries by the insured
774 from the sources known to the adjuster.
775 (h) An itemized statement of all compensation received by
776 the public adjuster from any source in connection with the loss.
777 (i) A register of all money received, deposited, disbursed,
778 and withdrawn in connection with a transaction with the insured,
779 including fees, transfers, and disbursements in connection with
780 the loss.
781 Section 11. Section 626.8796, Florida Statutes, is amended
782 to read:
783 626.8796 Public adjuster contracts; disclosure statement;
784 fraud statement.—
785 (1) All contracts for public adjuster services must be in
786 writing in at least 12-point type, be titled “Public Adjuster
787 Contract,” and prominently display the following statement on
788 the contract in minimum 18-point bold type before the space
789 reserved in the contract for the signature of the insured:
790 “Pursuant to s. 817.234, Florida Statutes, any person who, with
791 the intent to injure, defraud, or deceive an insurer or insured,
792 prepares, presents, or causes to be presented a proof of loss or
793 estimate of cost or repair of damaged property in support of a
794 claim under an insurance policy knowing that the proof of loss
795 or estimate of claim or repairs contains false, incomplete, or
796 misleading information concerning any fact or thing material to
797 the claim commits a felony of the third degree, punishable as
798 provided in s. 775.082, s. 775.083, or s. 775.084, Florida
799 Statutes.”
800 (2) A public adjuster contract relating to a property and
801 casualty claim must contain the full name, permanent business
802 address, phone number, e-mail address, and license number of the
803 public adjuster; the full name of the public adjusting firm; and
804 the insured’s full name, and street address, phone number, and
805 e-mail address, together with a brief description of the loss.
806 The contract must state the percentage of compensation for the
807 public adjuster’s services in minimum 18-point bold type before
808 the space reserved in the contract for the signature of the
809 insured; the type of claim, including an emergency claim,
810 nonemergency claim, or supplemental claim; the initials of the
811 named insured on each page that does not contain the insured’s
812 signature; the signatures of the public adjuster and all named
813 insureds; and the signature date. If all of the named insureds’
814 signatures are not available, the public adjuster must submit an
815 affidavit signed by the available named insureds attesting that
816 they have authority to enter into the contract and settle all
817 claim issues on behalf of the named insureds. An unaltered copy
818 of the executed contract must be remitted to the insured at the
819 time of execution and to the insurer, or the insurer’s
820 representative, within 7 30 days after execution. A public
821 adjusting firm that adjusts claims primarily for commercial
822 entities with operations in more than one state and that does
823 not directly or indirectly perform adjusting services for
824 insurers or individual homeowners is deemed to comply with the
825 requirements of this subsection if, at the time a proof of loss
826 is submitted, the public adjusting firm remits to the insurer an
827 affidavit signed by the public adjuster or public adjuster
828 apprentice that identifies:
829 (a) The full name, permanent business address, phone
830 number, e-mail address, and license number of the public
831 adjuster or public adjuster apprentice.
832 (b) The full name of the public adjusting firm.
833 (c) The insured’s full name, and street address, phone
834 number, and e-mail address, together with a brief description of
835 the loss.
836 (d) An attestation that the compensation for public
837 adjusting services will not exceed the limitations provided by
838 law.
839 (e) The type of claim, including an emergency claim,
840 nonemergency claim, or supplemental claim.
841 (3) The public adjuster shall not receive compensation for
842 services provided prior to the date the insured receives an
843 unaltered copiesy of the executed contract or the date executed
844 contract is submitted to the insurer. Proof of receipt by the
845 insured and proof of submission to the insurer must be
846 maintained by the public adjuster for not less than five years.
847 (4) The insured may rescind the contract for public
848 adjuster services if the public adjuster has not submitted a
849 written estimate to the insurer within 60 days after executing
850 the contract, unless the failure to provide the written estimate
851 within 60 days is caused by factors beyond the public adjuster’s
852 control.
853 (5) The cancellation period for failure to provide a
854 written estimate terminates on the date the estimate is
855 provided.
856 (6) Before the signing of the contract, the public adjuster
857 shall provide the insured with a separate disclosure document to
858 be signed by the insured, on a form adopted by the department,
859 regarding the claim process which accomplishes the following:
860 (a) Defines the following types of adjusters who may be
861 involved in the claim process: company adjuster, independent
862 adjuster, and public adjuster.
863 (b) Explains that the public adjuster is not a
864 representative or employee of the insurer.
865 (c) Explains that the insured is not required to hire a
866 public adjuster, but has a right to do so.
867 (d) Explains that an insured has a right to initiate direct
868 communications with the insured’s attorney, the insurer, the
869 company adjuster, the insurer’s attorney, or any person
870 regarding the settlement of the insured’s claim.
871 (e) Explains that the public adjuster’s salary, fee,
872 commission, or other consideration to be paid to a public
873 adjuster is the insured’s responsibility.
874 (f) Explains that the public adjuster is required to
875 provide the insured an unaltered copy of the executed contract
876 at the time of execution.
877 (g) Explains that if the contract was entered into based on
878 events that are the subject of a declaration of a state of
879 emergency by the Governor, an insured or a claimant may cancel
880 the public adjuster’s contract to adjust a claim without penalty
881 or obligation within 30 days after the date of loss or 10 days
882 after the date on which the contract is executed, whichever is
883 longer.
884 (h) The public adjuster shall provide an unaltered copy of
885 the executed disclosure document to the insured at the time of
886 execution.
887 (7) A contract that does not comply with this section is
888 invalid and unenforceable.
889 (8) The department may adopt rules pursuant to ss.
890 120.536(1) and 120.54 to implement this section, including rules
891 to adopt forms required by this section.
892 Section 12. Section 626.8797, Florida Statutes, is amended
893 to read:
894 626.8797 Proof of loss; fraud statement.—All proof-of-loss
895 statements must prominently display the following statement in
896 minimum 18-point bold type before the space reserved in the
897 contract for the signature of the insured: “Pursuant to s.
898 817.234, Florida Statutes, any person who, with the intent to
899 injure, defraud, or deceive any insurer or insured, prepares,
900 presents, or causes to be presented a proof of loss or estimate
901 of cost or repair of damaged property in support of a claim
902 under an insurance policy knowing that the proof of loss or
903 estimate of claim or repairs contains any false, incomplete, or
904 misleading information concerning any fact or thing material to
905 the claim commits a felony of the third degree, punishable as
906 provided in s. 775.082, s. 775.083, or s. 775.084, Florida
907 Statutes.”
908 Section 13. Paragraph (a) of subsection (1) of section
909 626.9541, Florida Statutes, is amended to read:
910 626.9541 Unfair methods of competition and unfair or
911 deceptive acts or practices defined.—
912 (1) UNFAIR METHODS OF COMPETITION AND UNFAIR OR DECEPTIVE
913 ACTS.—The following are defined as unfair methods of competition
914 and unfair or deceptive acts or practices:
915 (a) Misrepresentations and false advertising of insurance
916 policies.—Knowingly making, issuing, circulating, or causing to
917 be made, issued, or circulated, any estimate, illustration,
918 circular, statement, sales presentation, omission, comparison,
919 or property and casualty certificate of insurance altered after
920 being issued, which:
921 1. Misrepresents the benefits, advantages, conditions, or
922 terms of any insurance policy.
923 2. Misrepresents the dividends or share of the surplus to
924 be received on any insurance policy.
925 3. Makes any false or misleading statements as to the
926 dividends or share of surplus previously paid on any insurance
927 policy.
928 4. Is misleading, or is a misrepresentation, as to the
929 financial condition of any person or as to the legal reserve
930 system upon which any life insurer operates.
931 5. Uses any name or title of any insurance policy or class
932 of insurance policies misrepresenting the true nature thereof.
933 6. Is a misrepresentation for the purpose of inducing, or
934 tending to induce, the lapse, forfeiture, exchange, conversion,
935 or surrender of any insurance policy.
936 7. Is a misrepresentation for the purpose of effecting a
937 pledge or assignment of, or effecting a loan against, any
938 insurance policy.
939 8. Misrepresents any insurance policy as being shares of
940 stock or misrepresents ownership interest in the company.
941 9. Uses any advertisement that would mislead or otherwise
942 cause a reasonable person to believe mistakenly that the state
943 or the Federal Government is responsible for the insurance sales
944 activities of any person or stands behind any person’s credit or
945 that any person, the state, or the Federal Government guarantees
946 any returns on insurance products or is a source of payment of
947 any insurance obligation of or sold by any person.
948 10. Fails to disclose a third party that receives
949 royalties, referral fees, or other remuneration for sponsorship,
950 marketing, or use of third-party branding for a policy of health
951 insurance as defined in s. 624.603.
952 Section 14. Paragraph (c) of subsection (2) of section
953 627.4025, Florida Statutes, is amended, and paragraph (d) is
954 added to that subsection, to read:
955 627.4025 Residential coverage and hurricane coverage
956 defined.—
957 (2) As used in policies providing residential coverage:
958 (c) “Hurricane” for purposes of paragraphs (a) and (b)
959 means a storm system that has been declared to be a hurricane by
960 the National Hurricane Center of the National Weather Service.
961 The duration of the hurricane includes the time period, in
962 Florida:
963 1. Beginning at the time a hurricane watch or hurricane
964 warning is issued for any part of Florida by the National
965 Hurricane Center of the National Weather Service; and
966 2. Continuing for the time period during which the
967 hurricane conditions exist anywhere in Florida; and
968 3. Ending 72 hours following the termination of the last
969 hurricane watch or hurricane warning issued for any part of
970 Florida by the National Hurricane Center of the National Weather
971 Service.
972 (d) “Hurricane deductible” means the deductible applicable
973 to loss caused by a hurricane.
974 Section 15. Paragraph (b) of subsection (1) and paragraph
975 (b) of subsection (2) of section 627.4133, Florida Statutes, are
976 amended to read:
977 627.4133 Notice of cancellation, nonrenewal, or renewal
978 premium.—
979 (1) Except as provided in subsection (2):
980 (b) An insurer issuing a policy providing coverage for
981 property, casualty, except mortgage guaranty, surety, or marine
982 insurance, other than motor vehicle insurance subject to s.
983 627.728 or s. 627.7281, shall give the first-named insured
984 written notice of cancellation or termination other than
985 nonrenewal at least 45 days prior to the effective date of the
986 cancellation or termination, including in the written notice the
987 reason or reasons for the cancellation or termination, except
988 that:
989 1. When cancellation is for nonpayment of premium, at least
990 10 days’ written notice of cancellation accompanied by the
991 reason therefor shall be given. As used in this subparagraph and
992 s. 440.42(3), the term “nonpayment of premium” means failure of
993 the named insured to discharge when due any of her or his
994 obligations in connection with the payment of premiums on a
995 policy or any installment of such premium, whether the premium
996 is payable directly to the insurer or its agent or indirectly
997 under any premium finance plan or extension of credit, or
998 failure to maintain membership in an organization if such
999 membership is a condition precedent to insurance coverage.
1000 “Nonpayment of premium” also means the failure of a financial
1001 institution to honor an insurance applicant’s check after
1002 delivery to a licensed agent for payment of a premium, even if
1003 the agent has previously delivered or transferred the premium to
1004 the insurer. If a dishonored check represents the initial
1005 premium payment, the contract and all contractual obligations
1006 shall be void ab initio unless the nonpayment is cured within
1007 the earlier of 5 days after actual notice by certified mail is
1008 received by the applicant or 15 days after notice is sent to the
1009 applicant by certified mail or registered mail, and if the
1010 contract is void, any premium received by the insurer from a
1011 third party shall be refunded to that party in full; and
1012 2. When such cancellation or termination occurs during the
1013 first 60 90 days during which the insurance is in force and the
1014 insurance is canceled or terminated for reasons other than
1015 nonpayment of premium, at least 20 days’ written notice of
1016 cancellation or termination accompanied by the reason therefor
1017 shall be given except where there has been a material
1018 misstatement or misrepresentation or failure to comply with the
1019 underwriting requirements established by the insurer.
1020
1021 After the policy has been in effect for 60 90 days, no such
1022 policy shall be canceled by the insurer except when there has
1023 been a material misstatement, a nonpayment of premium, a failure
1024 to comply with underwriting requirements established by the
1025 insurer within 60 90 days of the date of effectuation of
1026 coverage, or a substantial change in the risk covered by the
1027 policy or when the cancellation is for all insureds under such
1028 policies for a given class of insureds. This subsection does not
1029 apply to individually rated risks having a policy term of less
1030 than 90 days.
1031 (d) Notwithstanding paragraph (b), Citizens Property
1032 Insurance Corporation, in underwriting risks that, prior to the
1033 date of the application, were most recently insured by an
1034 insurer that has been placed in receivership under chapter 631,
1035 may immediately cancel a policy insuring such risk that is in
1036 effect for 90 days or less for material misrepresentation or
1037 failure to comply with underwriting requirements established
1038 before the effectuation of coverage.
1039 (2) With respect to any personal lines or commercial
1040 residential property insurance policy, including, but not
1041 limited to, any homeowner, mobile home owner, farmowner,
1042 condominium association, condominium unit owner, apartment
1043 building, or other policy covering a residential structure or
1044 its contents:
1045 (b) The insurer shall give the first-named insured written
1046 notice of nonrenewal, cancellation, or termination at least 120
1047 days before the effective date of the nonrenewal, cancellation,
1048 or termination. The notice must include the reason for the
1049 nonrenewal, cancellation, or termination, except that:
1050 1. If cancellation is for nonpayment of premium, at least
1051 10 days’ written notice of cancellation accompanied by the
1052 reason therefor must be given. As used in this subparagraph, the
1053 term “nonpayment of premium” means failure of the named insured
1054 to discharge when due her or his obligations for paying the
1055 premium on a policy or an installment of such premium, whether
1056 the premium is payable directly to the insurer or its agent or
1057 indirectly under a premium finance plan or extension of credit,
1058 or failure to maintain membership in an organization if such
1059 membership is a condition precedent to insurance coverage. The
1060 term also means the failure of a financial institution to honor
1061 an insurance applicant’s check after delivery to a licensed
1062 agent for payment of a premium even if the agent has previously
1063 delivered or transferred the premium to the insurer. If a
1064 dishonored check represents the initial premium payment, the
1065 contract and all contractual obligations are void ab initio
1066 unless the nonpayment is cured within the earlier of 5 days
1067 after actual notice by certified mail is received by the
1068 applicant or 15 days after notice is sent to the applicant by
1069 certified mail or registered mail. If the contract is void, any
1070 premium received by the insurer from a third party must be
1071 refunded to that party in full.
1072 2. If cancellation or termination occurs during the first
1073 60 90 days the insurance is in force and the insurance is
1074 canceled or terminated for reasons other than nonpayment of
1075 premium, at least 20 days’ written notice of cancellation or
1076 termination accompanied by the reason therefor must be given
1077 unless there has been a material misstatement or
1078 misrepresentation or a failure to comply with the underwriting
1079 requirements established by the insurer.
1080 3. After the policy has been in effect for 60 90 days, the
1081 policy may not be canceled by the insurer unless there has been
1082 a material misstatement; a nonpayment of premium; a failure to
1083 comply, within 60 90 days after the date of effectuation of
1084 coverage, with underwriting requirements established by the
1085 insurer before the date of effectuation of coverage; or a
1086 substantial change in the risk covered by the policy or unless
1087 the cancellation is for all insureds under such policies for a
1088 given class of insureds. This subparagraph does not apply to
1089 individually rated risks that have a policy term of less than 90
1090 days.
1091 4. After a policy or contract has been in effect for more
1092 than 60 90 days, the insurer may not cancel or terminate the
1093 policy or contract based on credit information available in
1094 public records.
1095 5. A policy that is nonrenewed by Citizens Property
1096 Insurance Corporation, pursuant to s. 627.351(6), for a policy
1097 that has been assumed by an authorized insurer offering
1098 replacement coverage to the policyholder is exempt from the
1099 notice requirements of paragraph (a) and this paragraph. In such
1100 cases, the corporation must give the named insured written
1101 notice of nonrenewal at least 45 days before the effective date
1102 of the nonrenewal.
1103 6. Notwithstanding any other provision of law, an insurer
1104 may cancel or nonrenew a property insurance policy after at
1105 least 45 days’ notice if the office finds that the early
1106 cancellation of some or all of the insurer’s policies is
1107 necessary to protect the best interests of the public or
1108 policyholders and the office approves the insurer’s plan for
1109 early cancellation or nonrenewal of some or all of its policies.
1110 The office may base such finding upon the financial condition of
1111 the insurer, lack of adequate reinsurance coverage for hurricane
1112 risk, or other relevant factors. The office may condition its
1113 finding on the consent of the insurer to be placed under
1114 administrative supervision pursuant to s. 624.81 or to the
1115 appointment of a receiver under chapter 631.
1116 7. A policy covering both a home and a motor vehicle may be
1117 nonrenewed for any reason applicable to the property or motor
1118 vehicle insurance after providing 90 days’ notice.
1119 Section 16. Effective January 1, 2024, section 627.4554,
1120 Florida Statutes, is amended to read:
1121 627.4554 Suitability in annuity transactions investments.—
1122 (1) PURPOSE.—The purpose of this section is to require
1123 agents to act in the best interest of the consumer when making a
1124 recommendation of an annuity and to require insurers to
1125 establish and maintain a system to supervise so set forth
1126 standards and procedures for making recommendations to consumers
1127 which result in transactions involving annuity products, and to
1128 establish a system for supervising such recommendations in order
1129 to ensure that the insurance needs and financial objectives of
1130 consumers are effectively appropriately addressed at the time of
1131 the transaction.
1132 (2) SCOPE.—This section applies to any sale or
1133 recommendation of made to a consumer to purchase, exchange, or
1134 replace an annuity by an insurer or its agent, and which results
1135 in the purchase, exchange, or replacement recommended.
1136 (3) DEFINITIONS.—As used in this section, the term:
1137 (a) “Agent” means a person or entity required to be
1138 licensed under the laws of this state to sell, solicit, or
1139 negotiate insurance, including annuities. For purposes of this
1140 section, the term includes an insurer when no agent is involved
1141 has the same meaning as provided in s. 626.015.
1142 (b) “Annuity” means an insurance product under state law
1143 which is individually solicited, whether classified as an
1144 individual or group annuity.
1145 (c) “Cash compensation” means any discount, concession,
1146 fee, service fee, commission, sales charge, loan, override, or
1147 cash benefit received by an agent from an insurer or
1148 intermediary or directly from the consumer in connection with
1149 the recommendation or sale of an annuity.
1150 (d) “Consumer profile information” means information that
1151 is reasonably appropriate to determine whether a recommendation
1152 addresses the consumer’s financial situation, insurance needs,
1153 and financial objectives, including, at a minimum, the
1154 following:
1155 1. Age.
1156 2. Annual income.
1157 3. Financial situation and needs, including debts and other
1158 obligations.
1159 4. Financial experience.
1160 5. Insurance needs.
1161 6. Financial objectives.
1162 7. Intended use of the annuity.
1163 8. Financial time horizon.
1164 9. Existing assets or financial products, including
1165 investment, annuity, and insurance holdings.
1166 10. Liquidity needs.
1167 11. Liquid net worth.
1168 12. Risk tolerance, including, but not limited to,
1169 willingness to accept nonguaranteed elements in the annuity.
1170 13. Financial resources used to fund the annuity.
1171 14. Tax status.
1172 (e)(c) “FINRA” means the Financial Industry Regulatory
1173 Authority or a succeeding agency.
1174 (f)(d) “Insurer” has the same meaning as provided in s.
1175 624.03.
1176 (g) “Intermediary” means an entity contracted directly with
1177 an insurer or with another entity contracted with an insurer to
1178 facilitate the sale of the insurer’s annuities by agents.
1179 (h) “Material conflict of interest” means a financial
1180 interest of the agent in the sale of an annuity which a
1181 reasonable person would expect to influence the impartiality of
1182 a recommendation. The term does not include cash compensation or
1183 noncash compensation.
1184 (i) “Noncash compensation” means any form of compensation
1185 that is not cash compensation, including, but not limited to,
1186 health insurance, office rent, office support, and retirement
1187 benefits.
1188 (j) “Nonguaranteed elements” means the premiums; credited
1189 interest rates, including any bonus; benefits; values;
1190 dividends; noninterest-based credits; charges; or elements of
1191 formulas used to determine any of these, which are subject to
1192 company discretion and are not guaranteed at issue. An element
1193 is considered nonguaranteed if any of the underlying
1194 nonguaranteed elements are used in its calculation.
1195 (k)(e) “Recommendation” means advice provided by an insurer
1196 or its agent to an individual a consumer which was intended to
1197 result or does result which would result in a the purchase, an
1198 exchange, or a replacement of an annuity in accordance with that
1199 advice. The term does not include general communication to the
1200 public, generalized customer services, assistance or
1201 administrative support, general educational information and
1202 tools, prospectuses, or other product and sales material.
1203 (l)(f) “Replacement” means a transaction in which a new
1204 annuity policy or contract is to be purchased and it is known or
1205 should be known to the proposing insurer or its agent, or to the
1206 proposing insurer whether or not an agent is involved, that by
1207 reason of such transaction an existing annuity or other
1208 insurance policy has been or is to be any of the following or
1209 contract will be:
1210 1. Lapsed, forfeited, surrendered or partially surrendered,
1211 assigned to the replacing insurer, or otherwise terminated;
1212 2. Converted to reduced paid-up insurance, continued as
1213 extended term insurance, or otherwise reduced in value due to
1214 the use of nonforfeiture benefits or other policy values;
1215 3. Amended so as to effect a reduction in benefits or the
1216 term for which coverage would otherwise remain in force or for
1217 which benefits would be paid;
1218 4. Reissued with a reduction in cash value; or
1219 5. Used in a financed purchase.
1220 (m) “SEC” means the United States Securities and Exchange
1221 Commission.
1222 (g) “Suitability information” means information related to
1223 the consumer which is reasonably appropriate to determine the
1224 suitability of a recommendation made to the consumer, including
1225 the following:
1226 1. Age;
1227 2. Annual income;
1228 3. Financial situation and needs, including the financial
1229 resources used for funding the annuity;
1230 4. Financial experience;
1231 5. Financial objectives;
1232 6. Intended use of the annuity;
1233 7. Financial time horizon;
1234 8. Existing assets, including investment and life insurance
1235 holdings;
1236 9. Liquidity needs;
1237 10. Liquid net worth;
1238 11. Risk tolerance; and
1239 12. Tax status.
1240 (4) EXEMPTIONS.—Unless otherwise specifically included,
1241 this section does not apply to transactions involving:
1242 (a) Direct-response solicitations where there is no
1243 recommendation based on information collected from the consumer
1244 pursuant to this section;
1245 (b) Contracts used to fund:
1246 1. An employee pension or welfare benefit plan that is
1247 covered by the federal Employee Retirement and Income Security
1248 Act;
1249 2. A plan described by s. 401(a), s. 401(k), s. 403(b), s.
1250 408(k), or s. 408(p) of the Internal Revenue Code, if
1251 established or maintained by an employer;
1252 3. A government or church plan defined in s. 414 of the
1253 Internal Revenue Code, a government or church welfare benefit
1254 plan, or a deferred compensation plan of a state or local
1255 government or tax-exempt organization under s. 457 of the
1256 Internal Revenue Code; or
1257 4. A nonqualified deferred compensation arrangement
1258 established or maintained by an employer or plan sponsor;
1259 (c)5. Settlements or assumptions of liabilities associated
1260 with personal injury litigation or a dispute or claim-resolution
1261 process; or
1262 (d)6. Formal prepaid funeral contracts.
1263 (5) DUTIES OF INSURERS AND AGENTS.—
1264 (a) An agent, when making a recommendation of an annuity,
1265 shall act in the best interest of the consumer under the
1266 circumstances known at the time the recommendation is made,
1267 without placing the financial interest of the agent or insurer
1268 ahead of the consumer’s interest. An agent has acted in the best
1269 interest of the consumer if the agent has satisfied the
1270 following obligations regarding care, disclosure, conflict of
1271 interest, and documentation:
1272 1.a. The agent, in making a recommendation, shall exercise
1273 reasonable diligence, care, and skill to:
1274 (I) Know the financial situation, insurance needs, and
1275 financial objectives of the customer.
1276 (II) Understand the available options after making a
1277 reasonable inquiry into options available to the agent.
1278 (III) Have a reasonable basis to believe the recommended
1279 option effectively addresses the consumer’s financial situation,
1280 insurance needs, and financial objectives over the life of the
1281 product, as evaluated in light of the consumer profile
1282 information.
1283 (IV) Communicate the reason or reasons for the
1284 recommendation.
1285 b. The requirements of sub-subparagraph a. include:
1286 (I) Making reasonable efforts to obtain consumer profile
1287 information from the consumer before the recommendation of an
1288 annuity.
1289 (II) Requiring an agent to consider the types of products
1290 the agent is authorized and licensed to recommend or sell which
1291 address the consumer’s financial situation, insurance needs, and
1292 financial objectives. This does not require analysis or
1293 consideration of any products outside the authority and license
1294 of the agent or other possible alternative products or
1295 strategies available in the market at the time of the
1296 recommendation. Agents shall be held to standards applicable to
1297 agents with similar authority and licensure.
1298 (III) Having a reasonable basis to believe the consumer
1299 would benefit from certain features of the annuity, such as
1300 annuitization, death or living benefit, or other insurance
1301 related features.
1302 c. The requirements of this subsection do not create a
1303 fiduciary obligation or relationship and only create a
1304 regulatory obligation as provided in this section.
1305 d. The consumer profile information, characteristics of the
1306 insurer, and product costs, rates, benefits, and features are
1307 those factors generally relevant in making a determination
1308 whether an annuity effectively addresses the consumer’s
1309 financial situation, insurance needs, and financial objectives,
1310 but the level of importance of each factor under the care
1311 obligation of this paragraph may vary depending on the facts and
1312 circumstances of a particular case. However, each factor may not
1313 be considered in isolation.
1314 e. The requirements under sub-subparagraph a. apply to the
1315 particular annuity as a whole and the underlying subaccounts to
1316 which funds are allocated at the time of purchase or exchange of
1317 an annuity, and riders and similar product enhancements, if any.
1318 f. Sub-subparagraph a. does not require that the annuity
1319 with the lowest one-time occurrence compensation structure or
1320 multiple occurrence compensation structure shall necessarily be
1321 recommended.
1322 g. Sub-subparagraph a. does not require the agent to have
1323 ongoing monitoring obligations under the care obligation,
1324 although such an obligation may be separately owed under the
1325 terms of a fiduciary, consulting, investment, advising, or
1326 financial planning agreement between the consumer and the agent.
1327 h. In the case of an exchange or replacement of an annuity,
1328 the agent shall consider the whole transaction, which includes
1329 taking into consideration whether:
1330 (I) The consumer will incur a surrender charge; be subject
1331 to the commencement of a new surrender period; lose existing
1332 benefits, such as death, living, or other contractual benefits;
1333 or be subject to increased fees, investment advisory fees, or
1334 charges for riders and similar product enhancements.
1335 (II) The replacing product would substantially benefit the
1336 consumer in comparison to the replaced product over the life of
1337 the product.
1338 (III) The consumer has had another annuity exchange or
1339 replacement and, in particular, an exchange or replacement
1340 within the preceding 60 months.
1341 i. This section does not require an agent to obtain any
1342 license other than an agent license with the appropriate line of
1343 authority to sell, solicit, or negotiate insurance in this
1344 state, including, but not limited to, any securities license, in
1345 order to fulfill the duties and obligations contained in this
1346 section; provided, the agent does not give advice or provide
1347 services that are otherwise subject to securities laws or engage
1348 in any other activity requiring other professional licenses.
1349 2.a. Before the recommendation or sale of an annuity, the
1350 agent shall prominently disclose to the consumer, on a form
1351 substantially similar to that posted on the office website as
1352 Appendix A, related to an insurance agent disclosure for
1353 annuities:
1354 (I) A description of the scope and terms of the
1355 relationship with the consumer and the role of the agent in the
1356 transaction.
1357 (II) An affirmative statement on whether the agent is
1358 licensed and authorized to sell the following products:
1359 (A) Fixed annuities.
1360 (B) Fixed indexed annuities.
1361 (C) Variable annuities.
1362 (D) Life insurance.
1363 (E) Mutual funds.
1364 (F) Stocks and bonds.
1365 (G) Certificates of deposit.
1366 (III) An affirmative statement describing the insurers for
1367 which the agent is authorized, contracted, or appointed, or
1368 otherwise able to sell insurance products, using the following
1369 descriptions:
1370 (A) From one insurer;
1371 (B) From two or more insurers; or
1372 (C) From two or more insurers, although primarily
1373 contracted with one insurer.
1374 (IV) A description of the sources and types of cash
1375 compensation and noncash compensation to be received by the
1376 agent, including whether the agent is to be compensated for the
1377 sale of a recommended annuity by commission as part of premium
1378 or other remuneration received from the insurer, intermediary,
1379 or other agent, or by fee as a result of a contract for advice
1380 or consulting services.
1381 (V) A notice of the consumer’s right to request additional
1382 information regarding cash compensation described in sub
1383 subparagraph b.
1384 b. Upon request of the consumer or the consumer’s
1385 designated representative, the agent shall disclose:
1386 (I) A reasonable estimate of the amount of cash
1387 compensation to be received by the agent, which may be stated as
1388 a range of amounts or percentages.
1389 (II) Whether the cash compensation is a one-time or
1390 multiple occurrence amount; and if a multiple occurrence amount,
1391 the frequency and amount of the occurrence, which may be stated
1392 as a range of amounts or percentages. When recommending the
1393 purchase or exchange of an annuity to a consumer which results
1394 in an insurance transaction or series of insurance transactions,
1395 the agent, or the insurer where no agent is involved, must have
1396 reasonable grounds for believing that the recommendation is
1397 suitable for the consumer, based on the consumer’s suitability
1398 information, and that there is a reasonable basis to believe all
1399 of the following:
1400 c.1. Before or at the time of the recommendation or sale of
1401 an annuity, the agent shall have a reasonable basis to believe
1402 the consumer has been reasonably informed of various features of
1403 the annuity, such as the potential surrender period and
1404 surrender charge; potential tax penalty if the consumer sells,
1405 exchanges, surrenders, or annuitizes the annuity; mortality and
1406 expense fees; any annual fees; investment advisory fees;
1407 potential charges for and features of riders or other options of
1408 the annuity; limitations on interest returns; potential changes
1409 in nonguaranteed elements of the annuity; insurance and
1410 investment components; and market risk.
1411 2. The consumer would benefit from certain features of the
1412 annuity, such as tax-deferred growth, annuitization, or the
1413 death or living benefit.
1414 3. An agent shall identify and avoid or reasonably manage
1415 and disclose material conflicts of interest, including material
1416 conflicts of interest related to an ownership interest.
1417 4. An agent shall at the time of the recommendation or
1418 sale:
1419 a. Make a written record of any recommendation and the
1420 basis for the recommendation, subject to this section.
1421 b. Obtain a consumer-signed statement on a form
1422 substantially similar to that posted on the office website as
1423 Appendix B, related to a consumer’s refusal to provide
1424 information, documenting:
1425 (I) A customer’s refusal to provide the consumer profile
1426 information, if any.
1427 (II) A customer’s understanding of the ramifications of not
1428 providing his or her consumer profile information or providing
1429 insufficient consumer profile information.
1430 c. Obtain a consumer-signed statement on a form
1431 substantially similar to that posted on the office website as
1432 Appendix C, related to a consumer’s decision to purchase an
1433 annuity not based on a recommendation, acknowledging the annuity
1434 transaction is not recommended if a customer decides to enter
1435 into an annuity transaction that is not based on the agent’s
1436 recommendation.
1437 5. Any requirement applicable to an agent under this
1438 subsection applies to every agent who has exercised material
1439 control or influence in the making of a recommendation and has
1440 received direct compensation as a result of the recommendation
1441 or sale, regardless of whether the agent has had any direct
1442 contact with the consumer. Activities such as providing or
1443 delivering marketing or education materials, product wholesaling
1444 or other back office product support, and general supervision of
1445 an agent do not, in and of themselves, constitute material
1446 control or influence.
1447 3. The particular annuity as a whole, the underlying
1448 subaccounts to which funds are allocated at the time of purchase
1449 or exchange of the annuity, and riders and similar product
1450 enhancements, if any, are suitable; and, in the case of an
1451 exchange or replacement, the transaction as a whole is suitable
1452 for the particular consumer based on his or her suitability
1453 information.
1454 4. In the case of an exchange or replacement of an annuity,
1455 the exchange or replacement is suitable after considering
1456 whether the consumer:
1457 a. Will incur a surrender charge; be subject to the
1458 commencement of a new surrender period; lose existing benefits,
1459 such as death, living, or other contractual benefits; or be
1460 subject to increased fees, investment advisory fees, or charges
1461 for riders and similar product enhancements;
1462 b. Would benefit from product enhancements and
1463 improvements; and
1464 c. Has had another annuity exchange or replacement,
1465 including an exchange or replacement within the preceding 36
1466 months.
1467 (b) Before executing a purchase, exchange, or replacement
1468 of an annuity resulting from a recommendation, an insurer or its
1469 agent must make reasonable efforts to obtain the consumer’s
1470 suitability information. The information shall be collected on
1471 form DFS-H1-1980, which is hereby incorporated by reference, and
1472 completed and signed by the applicant and agent. Questions
1473 requesting this information must be presented in at least 12
1474 point type and be sufficiently clear so as to be readily
1475 understandable by both the agent and the consumer. A true and
1476 correct executed copy of the form must be provided by the agent
1477 to the insurer, or to the person or entity that has contracted
1478 with the insurer to perform this function as authorized by this
1479 section, within 10 days after execution of the form, and shall
1480 be provided to the consumer no later than the date of delivery
1481 of the contract or contracts.
1482 (c) Except as provided under paragraph (d), an insurer may
1483 not issue an annuity recommended to a consumer unless there is a
1484 reasonable basis to believe the annuity is suitable based on the
1485 consumer’s suitability information.
1486 (b)1.(d) Except as provided under subparagraph 2., An
1487 insurer’s issuance of an annuity must be reasonable based on all
1488 the circumstances actually known to the insurer at the time the
1489 annuity is issued. However, an insurer or its agent does not
1490 have does not have an obligation to a consumer related to an
1491 annuity transaction under subparagraph (a)1. paragraph (a) or
1492 paragraph (c) if:
1493 a.1. A recommendation has not been made;
1494 b.2. A recommendation was made and is later found to have
1495 been based on materially inaccurate information provided by the
1496 consumer;
1497 c.3. A consumer refuses to provide relevant consumer
1498 profile suitability information and the annuity transaction is
1499 not recommended; or
1500 d.4. A consumer decides to enter into an annuity
1501 transaction that is not based on a recommendation of the an
1502 insurer or its agent.
1503 2. An insurer’s issuance of an annuity subject to
1504 subparagraph 1. must be reasonable under all the circumstances
1505 actually known to the insurer at the time the annuity is issued.
1506 (c)1. Except as permitted under paragraph (b), an insurer
1507 may not issue an annuity recommended to a consumer unless there
1508 is a reasonable basis to believe the annuity would effectively
1509 address the particular consumer’s financial situation, insurance
1510 needs, and financial objectives based on the consumer’s consumer
1511 profile information.
1512 (e) At the time of sale, the agent or the agent’s
1513 representative must:
1514 1. Make a record of any recommendation made to the consumer
1515 pursuant to paragraph (a);
1516 2. Obtain the consumer’s signed statement documenting his
1517 or her refusal to provide suitability information, if
1518 applicable; and
1519 3. Obtain the consumer’s signed statement acknowledging
1520 that an annuity transaction is not recommended if he or she
1521 decides to enter into an annuity transaction that is not based
1522 on the insurer’s or its agent’s recommendation, if applicable.
1523 (f) Before executing a replacement or exchange of an
1524 annuity contract resulting from a recommendation, the agent must
1525 provide on form DFS-H1-1981, which is hereby incorporated by
1526 reference, information that compares the differences between the
1527 existing annuity contract and the annuity contract being
1528 recommended in order to determine the suitability of the
1529 recommendation and its benefit to the consumer. A true and
1530 correct executed copy of this form must be provided by the agent
1531 to the insurer, or to the person or entity that has contracted
1532 with the insurer to perform this function as authorized by this
1533 section, within 10 days after execution of the form, and must be
1534 provided to the consumer no later than the date of delivery of
1535 the contract or contracts.
1536 2.(g) An insurer shall establish and maintain a supervision
1537 system that is reasonably designed to achieve the insurer’s and
1538 its agent’s compliance with this section, including, but not
1539 limited to, the following:.
1540 1. Such system must include, but is not limited to:
1541 a. The insurer shall establish and maintain Maintaining
1542 reasonable procedures to inform its agents of the requirements
1543 of this section and incorporating those requirements into
1544 relevant agent training manuals.;
1545 b. The insurer shall establish and maintain Establishing
1546 standards for agent product training and shall establish and
1547 maintain reasonable procedures to require its agents to comply
1548 with the requirements of subsection (6).;
1549 c. The insurer shall provide Providing product-specific
1550 training and training materials that explain all material
1551 features of its annuity products to its agents.;
1552 d. The insurer shall establish and maintain Maintaining
1553 procedures for the review of each recommendation before issuance
1554 of an annuity which are designed to ensure that there is a
1555 reasonable basis to determine the recommended annuity would
1556 effectively address the particular consumer’s financial
1557 situation, insurance needs, and financial objectives for
1558 determining that a recommendation is suitable. Such review
1559 procedures may use a screening system for identifying selected
1560 transactions for additional review and may be accomplished
1561 electronically or through other means, including, but not
1562 limited to, physical review. Such electronic or other system may
1563 be designed to require additional review only of those
1564 transactions identified for additional review using established
1565 selection criteria.;
1566 e. The insurer shall establish and maintain Maintaining
1567 reasonable procedures to detect recommendations that are not in
1568 compliance with paragraphs (a), (b), (d), and (e). This may
1569 include, but is not limited to, suitable, such as confirmation
1570 of consumer profile suitability information, systematic customer
1571 surveys, agent and consumer interviews, confirmation letters,
1572 agent statements or attestations, and internal monitoring
1573 programs. This sub-subparagraph does not prevent an insurer from
1574 using sampling procedures or from confirming the consumer
1575 profile suitability information after the issuance or delivery
1576 of the annuity.; and
1577 f. The insurer shall establish and maintain reasonable
1578 procedures to assess, prior to or upon issuance or delivery of
1579 an annuity, whether an agent has provided to the consumer the
1580 information required to be provided under this subsection.
1581 g. The insurer shall establish and maintain reasonable
1582 procedures to identify and address suspicious consumer refusals
1583 to provide consumer profile information.
1584 h. The insurer shall establish and maintain reasonable
1585 procedures to identify and eliminate any sales contests, sales
1586 quotas, bonuses, and noncash compensation that are based on the
1587 sales of specific annuities within a limited period of time. The
1588 requirements of this sub-subparagraph are not intended to
1589 prohibit the receipt of health insurance, office rents, office
1590 support, retirement benefits, or other employee benefits by
1591 employees, as long as those benefits are not based upon the
1592 volume of sales of a specific annuity within a limited period of
1593 time.
1594 i.f. The insurer shall annually provide providing a written
1595 report to senior managers, including the senior manager who is
1596 responsible for audit functions, which details a review, along
1597 with appropriate testing, which is reasonably designed to
1598 determine the effectiveness of the supervision system, the
1599 exceptions found, and corrective action taken or recommended, if
1600 any.
1601 3.2. An insurer is not required to include in its
1602 supervision system:
1603 a. Agent recommendations to consumers of products other
1604 than the annuities offered by the insurer; or
1605 b. Consideration of or comparison to options available to
1606 the agent or compensation relating to those options other than
1607 annuities or other products offered by the insurer.
1608 4.3. An insurer may contract for performance of a function,
1609 including maintenance of procedures, required under subparagraph
1610 1.
1611 a. An insurer’s supervision system under this subsection
1612 shall include supervision of contractual performance under this
1613 subsection, which includes, but is If an insurer contracts for
1614 the performance of a function, the insurer must include the
1615 supervision of contractual performance as part of those
1616 procedures listed in subparagraph 1. These include, but are not
1617 limited to:
1618 (I) Monitoring and, as appropriate, conducting audits to
1619 ensure that the contracted function is properly performed; and
1620 (II) Annually obtaining a certification from a senior
1621 manager who has responsibility for the contracted function that
1622 the manager has a reasonable basis to represent, and does
1623 represent, for representing that the function is being properly
1624 performed.
1625 b. An insurer is responsible for taking appropriate
1626 corrective action and may be subject to sanctions and penalties
1627 pursuant to subsection (8) (7) regardless of whether the insurer
1628 contracts for performance of a function and regardless of the
1629 insurer’s compliance with sub-subparagraph a.
1630 (d)(h) Neither an agent nor an insurer shall may not
1631 dissuade, or attempt to dissuade, a consumer from:
1632 1. Truthfully responding to an insurer’s request for
1633 confirmation of consumer profile suitability information;
1634 2. Filing a complaint; or
1635 3. Cooperating with the investigation of a complaint.
1636 (e)1.(i) Recommendations and sales made in compliance with
1637 comparable standards shall FINRA requirements pertaining to the
1638 suitability and supervision of annuity transactions satisfy the
1639 requirements of this section. This applies to all
1640 recommendations and FINRA broker-dealer sales of variable
1641 annuities made by financial professionals in compliance with
1642 business rules, controls, and procedures that satisfy a
1643 comparable standard even if such standard would not otherwise
1644 apply to the product or recommendation at issue and fixed
1645 annuities if the suitability and supervision is similar to those
1646 applied to variable annuity sales. However, this paragraph does
1647 not limit the ability of the office or the department to
1648 investigate and enforce, including investigate, the provisions
1649 of this section.
1650 2. Subparagraph 1. does not limit the insurer’s obligation
1651 to comply with subparagraph (c)1., although the insurer may base
1652 its analysis on information received from either the financial
1653 professional or the entity supervising the financial
1654 professional.
1655 3. For subparagraph 1. this paragraph to apply, an insurer
1656 must:
1657 a.1. Monitor relevant conduct of the financial professional
1658 seeking to rely on subparagraph 1. or the entity responsible for
1659 supervising the financial professional, such as the financial
1660 professional’s broker-dealer or an investment adviser registered
1661 under federal or state securities law, the FINRA member broker
1662 dealer using information collected in the normal course of an
1663 insurer’s business; and
1664 b.2. Provide to the entity responsible for supervising the
1665 financial professional seeking to rely on subparagraph 1., such
1666 as the financial professional’s broker-dealer or investment
1667 adviser registered under federal or state securities laws, FINRA
1668 member broker-dealer information and reports that are reasonably
1669 appropriate to assist such entity the FINRA member broker-dealer
1670 in maintaining its supervision system.
1671 4. For purposes of this paragraph, the term:
1672 a. “Comparable standards” means:
1673 (I) With respect to broker-dealers and registered
1674 representatives of broker-dealers, applicable SEC and FINRA
1675 rules pertaining to best interest obligations and supervision of
1676 annuity recommendations and sales, including, but not limited
1677 to, Regulation Best Interest, 17 C.F.R. s. 240.15l–1, and any
1678 amendments or successor regulations thereto;
1679 (II) With respect to investment advisers registered under
1680 federal or state securities laws or investment adviser
1681 representatives, the fiduciary duties and all other requirements
1682 imposed on such investment advisers or investment adviser
1683 representatives by contract or under the Investment Advisers Act
1684 of 1940 or applicable state securities laws, including, but not
1685 limited to, Form ADV and interpretations; and
1686 (III) With respect to plan fiduciaries or fiduciaries, the
1687 duties, obligations, prohibitions, and all other requirements
1688 attendant to such status under the Employee Retirement Income
1689 Security Act of 1974 or the Internal Revenue Code and any
1690 amendments or successor statutes thereto.
1691 b. “Financial professional” means an agent that is
1692 regulated and acting as:
1693 (I) A broker-dealer registered under federal or state
1694 securities laws or a registered representative of a broker
1695 dealer;
1696 (II) An investment adviser registered under federal or
1697 state securities laws or an investment adviser representative
1698 associated with the federal or state registered investment
1699 adviser; or
1700 (III) A plan fiduciary under s. 3(21) of the Employee
1701 Retirement Income Security Act of 1974 or fiduciary under s.
1702 4975(e)(3) of the Internal Revenue Code or any amendments or
1703 successor statutes thereto.
1704 (6) AGENT TRAINING.—
1705 (a) An agent shall not solicit the sale of an annuity
1706 product unless the agent has adequate knowledge of the product
1707 to recommend the annuity and the agent is in compliance with the
1708 insurer’s standards for product training. An agent may rely on
1709 insurer-provided, product-specific training standards and
1710 materials to comply with this subsection.
1711 (b)1.a. An agent who engages in the sale of annuity
1712 products shall complete a one-time 4-hour training course. This
1713 requirement is not part of an agent’s continuing education
1714 requirement in s. 626.2815; however, if a course provider
1715 submits and receives approval from the department, the course is
1716 eligible for continuing education credit pursuant to s.
1717 626.2815.
1718 b. Agents who hold a life insurance line of authority on
1719 January 1, 2024, and who desire to sell annuities shall complete
1720 the requirements of this subsection by July 1, 2024. Individuals
1721 who obtain a life insurance line of authority after January 1,
1722 2024, may not engage in the sale of annuities until the annuity
1723 training course required under this subsection has been
1724 completed.
1725 2. The minimum length of the training required under this
1726 subsection is 4 hours.
1727 3. The training required under this subsection shall
1728 include information on the following topics:
1729 a. The types of annuities and various classifications of
1730 annuities.
1731 b. Identification of the parties to an annuity.
1732 c. How product-specific annuity contract features affect
1733 consumers.
1734 d. The application of income taxation of qualified and
1735 nonqualified annuities.
1736 e. The primary uses of annuities.
1737 f. The appropriate standard of conduct, sales practices,
1738 replacement, and disclosure requirements.
1739 4. Providers of courses intended to comply with this
1740 subsection shall cover all topics listed in the prescribed
1741 outline and shall not present any marketing information or
1742 provide training on sales techniques or provide specific
1743 information about a particular insurer’s products. Additional
1744 topics may be offered in conjunction with and in addition to the
1745 required outline.
1746 5. An agent who has completed an annuity training course
1747 before January 1, 2024, shall, by July 1, 2024, complete either:
1748 a. A new 4-hour training course; or
1749 b. An additional 1-hour training course on appropriate
1750 sales practices, replacement, and disclosure requirements under
1751 this section.
1752 6. Annuity training courses may be conducted and completed
1753 by classroom or self-study methods.
1754 7. Providers of annuity training shall issue certificates
1755 of completion.
1756 8. The satisfaction of the training requirements of another
1757 state that are substantially similar to the provisions of this
1758 subsection shall be deemed to satisfy the training requirements
1759 of this subsection in this state.
1760 9. The satisfaction of the training requirements of any
1761 course or courses with components substantially similar to the
1762 provisions of this subsection shall be deemed to satisfy the
1763 training requirements of this subsection in this state.
1764 10. An insurer shall verify that an agent has completed the
1765 annuity training course required under this subsection before
1766 allowing the agent to sell an annuity product for that insurer.
1767 (7)(6) RECORDKEEPING.—
1768 (a) Insurers and agents must maintain or be able to make
1769 available to the office or department records of the information
1770 collected from the consumer and other information used in making
1771 the recommendations that were the basis for insurance
1772 transactions for 5 years after the insurance transaction is
1773 completed by the insurer. An insurer may maintain the
1774 documentation on behalf of its agent.
1775 (b) Records required to be maintained under this subsection
1776 may be maintained in paper, photographic, microprocess,
1777 magnetic, mechanical, or electronic media, or by any process
1778 that accurately reproduces the actual document.
1779 (8)(7) COMPLIANCE MITIGATION; PENALTIES.—
1780 (a) An insurer is responsible for compliance with this
1781 section. If a violation occurs because of the action or inaction
1782 of the insurer or its agent which results in harm to a consumer,
1783 the office may order the insurer to take reasonably appropriate
1784 corrective action for the consumer and may impose appropriate
1785 penalties and sanctions.
1786 (b) The department may order:
1787 1. An insurance agent to take reasonably appropriate
1788 corrective action for a consumer harmed by a violation of this
1789 section by the insurance agent, including monetary restitution
1790 of penalties or fees incurred by the consumer, and impose
1791 appropriate penalties and sanctions.
1792 2. A managing general agency or insurance agency that
1793 employs or contracts with an insurance agent to sell or solicit
1794 the sale of annuities to consumers to take reasonably
1795 appropriate corrective action for a consumer harmed by a
1796 violation of this section by the insurance agent.
1797 (c) In addition to any other penalty authorized under
1798 chapter 626, the department shall order an insurance agent to
1799 pay restitution to a consumer who has been deprived of money by
1800 the agent’s misappropriation, conversion, or unlawful
1801 withholding of moneys belonging to the consumer in the course of
1802 a transaction involving annuities. The amount of restitution
1803 required to be paid may not exceed the amount misappropriated,
1804 converted, or unlawfully withheld. This paragraph does not limit
1805 or restrict a person’s right to seek other remedies as provided
1806 by law.
1807 (d) Any applicable penalty under the Florida Insurance Code
1808 for a violation of this section shall be reduced or eliminated
1809 according to a schedule adopted by the office or the department,
1810 as appropriate, if corrective action for the consumer was taken
1811 promptly after a violation was discovered.
1812 (e) A violation of this section does not create or imply a
1813 private cause of action.
1814 (9)(8) PROHIBITED CHARGES.—An annuity contract issued to a
1815 senior consumer age 65 or older may not contain a surrender or
1816 deferred sales charge for a withdrawal of money from an annuity
1817 exceeding 10 percent of the amount withdrawn. The charge shall
1818 be reduced so that no surrender or deferred sales charge exists
1819 after the end of the 10th policy year or 10 years after the date
1820 of each premium payment if multiple premiums are paid, whichever
1821 is later. This subsection does not apply to annuities purchased
1822 by an accredited investor, as defined in Regulation D as adopted
1823 by the United States Securities and Exchange Commission, or to
1824 those annuities specified in paragraph (4)(b).
1825 (10)(9) RULES.—The department and the commission may adopt
1826 rules to administer this section. The department may adopt by
1827 rule the forms prescribed in the National Association of
1828 Insurance Commissioners Suitability in Annuity Transactions
1829 Model Regulation Appendix A - Insurance Agent (Producer)
1830 Disclosure for Annuities, Appendix B - Consumer Refusal to
1831 Provide Information, and Appendix C - Consumer Decision to
1832 Purchase an Annuity Not Based on a Recommendation.
1833 Section 17. Subsection (5) is added to section 627.70132,
1834 Florida Statutes, to read:
1835 627.70132 Notice of property insurance claim.—
1836 (5) For loss assessment claims made under s. 627.714, the
1837 notice of claim must be given to the insurer in accordance with
1838 the terms of the policy within 3 years of the date of loss.
1839 Section 18. Paragraph (b) of subsection (8) of section
1840 634.041, Florida Statutes, is amended to read:
1841 634.041 Qualifications for license.—To qualify for and hold
1842 a license to issue service agreements in this state, a service
1843 agreement company must be in compliance with this part, with
1844 applicable rules of the commission, with related sections of the
1845 Florida Insurance Code, and with its charter powers and must
1846 comply with the following:
1847 (8)
1848 (b) A service agreement company does not have to establish
1849 and maintain an unearned premium reserve if it secures and
1850 maintains contractual liability insurance in accordance with the
1851 following:
1852 1. Coverage of 100 percent of the claim exposure is
1853 obtained from an insurer approved by the office, which holds a
1854 certificate of authority under s. 624.401 to do business within
1855 this state, or secured through a risk retention group, which is
1856 authorized to do business within this state under s. 627.943 or
1857 s. 627.944. Such insurer or risk retention group must maintain a
1858 surplus as regards policyholders of at least $15 million.
1859 2. If the service agreement company does not meet its
1860 contractual obligations, the contractual liability insurance
1861 policy binds its issuer to pay or cause to be paid to the
1862 service agreement holder all legitimate claims and cancellation
1863 refunds for all service agreements issued by the service
1864 agreement company while the policy was in effect. This
1865 requirement also applies to those service agreements for which
1866 no premium has been remitted to the insurer.
1867 3. If the issuer of the contractual liability policy is
1868 fulfilling the service agreements covered by the contractual
1869 liability policy and the service agreement holder cancels the
1870 service agreement, the issuer must make a full refund of
1871 unearned premium to the consumer, subject to the cancellation
1872 fee provisions of s. 634.121(3). The sales representative and
1873 agent must refund to the contractual liability policy issuer
1874 their unearned pro rata commission.
1875 4. The policy may not be canceled, terminated, or
1876 nonrenewed by the insurer or the service agreement company
1877 unless a 90-day written notice thereof has been given to the
1878 office by the insurer before the date of the cancellation,
1879 termination, or nonrenewal.
1880 5. The service agreement company must provide the office
1881 with the claims statistics.
1882 6. A policy issued in compliance with this paragraph may
1883 either pay 100 percent of claims as they are incurred, or 100
1884 percent of claims due in the event of the failure of the service
1885 agreement company to pay such claims when due.
1886
1887 All funds or premiums remitted to an insurer by a motor vehicle
1888 service agreement company under this part shall remain in the
1889 care, custody, and control of the insurer and shall be counted
1890 as an asset of the insurer; provided, however, this requirement
1891 does not apply when the insurer and the motor vehicle service
1892 agreement company are affiliated companies and members of an
1893 insurance holding company system. If the motor vehicle service
1894 agreement company chooses to comply with this paragraph but also
1895 maintains a reserve to pay claims, such reserve shall only be
1896 considered an asset of the covered motor vehicle service
1897 agreement company and may not be simultaneously counted as an
1898 asset of any other entity.
1899 Section 19. Paragraphs (d), (e), and (f) of subsection (17)
1900 of section 634.401, Florida Statutes, are amended to read:
1901 634.401 Definitions.—As used in this part, the term:
1902 (17) “Manufacturer” means any entity or its affiliate
1903 which:
1904 (d) Maintains outstanding debt obligations, if any, rated
1905 in the top four rating categories by a recognized rating
1906 service;
1907 (d)(e) Has and maintains at all times, a minimum net worth
1908 of at least $100 $10 million as evidenced by certified financial
1909 statements prepared by an independent certified public
1910 accountant in accordance with generally accepted accounting
1911 principles; and
1912 (e)(f) Is authorized to do business in this state.
1913 Section 20. Paragraph (a) of subsection (7) of section
1914 634.406, Florida Statutes, is amended to read:
1915 634.406 Financial requirements.—
1916 (7) An association licensed under this part and holding no
1917 other license under part I or part II of this chapter is not
1918 required to establish an unearned premium reserve or maintain
1919 contractual liability insurance and may allow its premiums to
1920 exceed the ratio to net assets limitation of this section if the
1921 association complies with the following:
1922 (a) The association or, if the association is a direct or
1923 indirect wholly owned subsidiary of a parent corporation, its
1924 parent corporation has, and maintains at all times, a minimum
1925 net worth of at least $100 million and provides the office with
1926 the following:
1927 1. A copy of the association’s annual audited financial
1928 statements or the audited consolidated financial statements of
1929 the association’s parent corporation, prepared by an independent
1930 certified public accountant in accordance with generally
1931 accepted accounting principles, which clearly demonstrate the
1932 net worth of the association or its parent corporation to be
1933 $100 million and a quarterly written certification to the office
1934 that such entity continues to maintain the net worth required
1935 under this paragraph.
1936 2. The association’s, or its parent corporation’s, Form 10
1937 K, Form 10-Q, or Form 20-F as filed with the United States
1938 Securities and Exchange Commission or such other documents
1939 required to be filed with a recognized stock exchange, which
1940 shall be provided on a quarterly and annual basis within 10 days
1941 after the last date each such report must be filed with the
1942 Securities and Exchange Commission, the National Association of
1943 Security Dealers Automated Quotation system, or other recognized
1944 stock exchange.
1945
1946 Failure to timely file the documents required under this
1947 paragraph may, at the discretion of the office, subject the
1948 association to suspension or revocation of its license under
1949 this part. An association or parent corporation demonstrating
1950 compliance with subparagraphs 1. and 2. must maintain
1951 outstanding debt obligations, if any, rated in the top four
1952 rating categories by a recognized rating service.
1953 Section 21. Except as otherwise expressly provided in this
1954 act, this act shall take effect July 1, 2023.
1955
1956 ================= T I T L E A M E N D M E N T ================
1957 And the title is amended as follows:
1958 Delete everything before the enacting clause
1959 and insert:
1960 A bill to be entitled
1961 An act relating to consumer protection; amending s.
1962 494.001, F.S.; revising the definition of the term
1963 “branch office”; defining the term “remote location”;
1964 authorizing a licensee under ch. 494, F.S., to allow
1965 loan originators to work from remote locations if
1966 specified conditions are met; amending s. 494.0067,
1967 F.S.; specifying that mortgage lenders may transact
1968 business from branch offices and remote locations;
1969 providing a requirement for operating remote
1970 locations; creating s. 501.2042, F.S.; providing
1971 requirements for crowd-funding platforms and
1972 organizers of crowd-funding campaigns related to and
1973 arising out of declared disasters; amending s. 520.23,
1974 F.S.; revising disclosure requirements for agreements
1975 governing the sale or lease of a distributed energy
1976 generation system; amending s. 560.111, F.S.;
1977 providing a criminal penalty; amending s. 560.309,
1978 F.S.; prohibiting a licensee under ch. 560, F.S., from
1979 cashing corporate checks for certain payees where the
1980 aggregate face amount exceeds a specified amount;
1981 amending s. 626.551, F.S.; revising the timeframe in
1982 which an insurance representative must notify the
1983 Department of Financial Services of certain changes in
1984 information; amending s. 626.602, F.S.; providing
1985 applicability of provisions relating to the
1986 disapproval of insurance agency names to adjusting
1987 firm names; revising grounds on which such names may
1988 be disapproved by the department; deleting an obsolete
1989 provision; amending s. 626.854, F.S.; revising the
1990 definition of the term “public adjuster”; prohibiting
1991 public adjusters from contracting with anyone other
1992 than the named insured without the insured’s written
1993 consent; specifying a penalty for noncompliance;
1994 specifying timeframes in which an insured or a
1995 claimant may cancel a public adjuster’s contract
1996 without penalty or contract under certain
1997 circumstances; revising requirements for public
1998 adjusters’ contracts; specifying requirements for
1999 public adjusters if the insurer, within a certain
2000 timeframe, pays or commits in writing to pay to the
2001 insured the policy limit of the policy; specifying
2002 limitations on commissions received by public
2003 adjusters; amending s. 626.860, F.S.; providing that
2004 an attorney’s exemption from public adjuster licensure
2005 requirements does not apply to certain persons;
2006 amending s. 626.875, F.S.; revising recordkeeping
2007 requirements for appointed independent adjusters and
2008 licensed public adjusters; amending s. 626.8796, F.S.;
2009 revising requirements for public adjuster contracts;
2010 specifying requirements for and prohibitions on public
2011 adjusters relating to such contracts; providing
2012 construction; authorizing the department to adopt
2013 rules; amending s. 626.8797, F.S.; revising a fraud
2014 statement requirement in proof-of-loss statements;
2015 amending s. 626.9541, F.S.; adding an unfair or
2016 deceptive insurance act relating to health insurance
2017 policies; amending s. 627.4025, F.S.; revising the
2018 definition of the term “hurricane,” and defining the
2019 term “hurricane deductible,” as used in policies
2020 providing residential coverage; amending s. 627.4133,
2021 F.S.; revising conditions that apply to a specified
2022 notice requirement for, and a limitation on, the
2023 cancellation or termination of certain insurance
2024 policies; amending s. 627.4554, F.S.; revising
2025 legislative purpose; revising applicability; revising
2026 and defining terms; revising and specifying duties of
2027 insurers and agents relating to the recommendation and
2028 sale of annuity investments; specifying comparable
2029 standards that comply with such requirements;
2030 specifying agent training requirements; providing and
2031 revising construction; authorizing the department to
2032 adopt certain forms by rule; amending s. 627.70132,
2033 F.S.; specifying the period in which notices of loss
2034 assessment claims under residential condominium unit
2035 owner coverage must be given to the insurer; amending
2036 s. 634.041, F.S.; specifying authorized methods of
2037 paying claims for motor vehicle service agreements;
2038 amending s. 634.401, F.S.; revising the definition of
2039 the term “manufacturer” for purposes of part III of
2040 ch. 634, F.S.; amending s. 634.406, F.S.; deleting a
2041 debt obligation rating requirement for certain service
2042 warranty associations or parent corporations;
2043 providing effective dates.