Licensure & Compliance

Agency Licensing and Registration

Last updated: July 1, 2010

Frequently Asked Questions

1. I'm opening an insurance agency. Do you have any tips to help me out?
   Click here for guidance on opening an insurance agency.
2. Where is the application for agency registrations and agency licensures found?
   The agency application can be found at www.MyFloridaCFO.com/Agents and logging in to the agency’s profile in MyProfile. Click here to log in and select "Insurance Agency".
3. What is the cost of an agency registration or licensure?
   There are no application fees for an agency licensure or registration. However, fingerprints may be required for some individuals and require a processing fee.
4. What is the difference between agency registration and agency licensure?
   Registration - A registration is offered to agencies that were in business prior to January 1, 2003, and which qualify as one of the following:
   • An agency wholly owned by licensed and appointed Florida insurance agents
   • An incorporated agency whose voting shares is traded on a securities exchange
   • An agency whose primary function is offering insurance as a service or member benefit to members of a nonprofit organization
   • An agency subject to supervision and inspection as a branch office under the rules of the NASD
   A registration is perpetual (not renewed). A registered agency is not subject to compulsory or discretionary refusal, suspension, or revocation as described in Florida Statutes 626.6115 and 626.6215. However, if any of the principals of the registered agency are found to have violated any part of the insurance code, the agency must obtain an agency license.
   Licensure - A license is required for agencies that were in business on or after January 1, 2003, or the agencies that were in business prior to January 1, 2003, and do not meet the criteria listed above for registration. A licensed agency is subject to compulsory or discretionary refusal, suspension, or revocation as described in Florida Statutes 626.6115 and 626.6215. An agency license must be renewed three years from the original issue date. There is no application fee associated with the issuance or renewal of the agency license.
5. If an agency fails to apply for registration or licensure, can the department take action against the agency?
   Yes. If an agency qualifies for registration and fails to file an application, the department may impose an administrative penalty on the agency in an amount of up to $5,000.00. If an agency does not qualify for registration and fails to file an application for licensure, the department may impose an administrative penalty on the agency in an amount of up to $10,000.00.
6. If an agency registers and then decides it would be more beneficial to be licensed, how would the agency make this change?
   The agency can submit an online application to the department at our homepage at www.MyFloridaCFO.com/Agents and logging in to the agency’s account in MyProfile and select "Insurance Agency". The registration will be canceled once the license is approved.
7. If an agency qualifies for registration but chooses to apply for licensure, can it later file for registration?
   No. Once an agency has obtained a license, it can not be registered.
8. When applications are submitted for licensure, are there exemptions for filing fingerprints?
   Yes. The exemptions are as follows:
   • The individual has been fingerprinted with this Division in the past 12 months.
   • The individual is currently licensed and appointed as a Florida insurance agent.
   • The directors or officers of a corporation whose voting shares are traded on a securities exchange.
9. Does a corporate insurance agency have to submit fingerprints for every corporate officer even if the officer has nothing to do with the corporation’s insurance operations?
   No. The application limits the number of people who must submit fingerprints to the president, secretary, treasurer and any officer or other person who directs or participates, directly or indirectly, in the control or management of the agency.
10. What are the duties and responsibilities of the agent-in-charge?
    An agent-in-charge does not have any statutory duties or responsibilities. “Agent-in-charge” is not defined in the Florida Insurance Code and the Code does not contain any statutes that are specifically applicable to the agent-in-charge as opposed to any other licensed agent.
11. Will the applicant know immediately if the application is approved?
    No. When an application is filed through the application system, the applicant will not be immediately advised of approval or disapproval of the agency registration or licensure. However, the applicant will be advised by the application system that the application filing was successful.
12. Do agencies require appointments?
    No. Insurance agencies are not appointed. However, individuals who transact insurance business within the agency must be licensed and appointed.
13. Are adjusting firms now required to obtain a license?
    No. Only an adjusting firm that has been directed to obtain licensure through a disciplinary action by the Department is required to be licensed.
14. Does each branch of an insurance agency, bank or securities firm that engages in the transaction of insurance have to be licensed or registered?
    Yes. Florida Statute 626.112(7)(a) provides, in pertinent part, that “no individual, firm, partnership, corporation, association, or any other entity shall act … as an insurance agency, unless it complies with Florida Statute 626.172 with respect to possessing an insurance agency license for each place of business at which it engages in any activity which may be performed only by a licensed insurance agent. “Insurance agency is defined, in pertinent part, in Florida Statute 626.015(8) as: “Insurance agency” means “a business location at which an individual, firm, partnership, corporation, association, or other entity … engages in any activity or employs individuals to engage in any activity, which by law may be performed only by a licensed insurance agent.”
15. If a life or health insurance agent “works” out of his/her home, is the agent’s home an insurance agency that must be licensed?
    It depends. If the agent does not hold the home out as being a business location at which consumers can purchase or inquire about insurance products and all insurance transactions by the agent occur at other locations where the agent arranges to meet customers, no. However, if the agent does hold the home out as being a business location at which consumers can purchase or inquire about insurance products and all insurance transactions by the agent occur at this location, yes and must comply with Florida Statute 626.749.
16. How will the department determine whether the agent is holding out his home as a place that is engaged in the insurance business or not?
    The department will consider factors such as whether the agent advertises his services in newspapers, phone books or in other ways and includes his home address in the ad; whether there is a sign on the house indicating that there is an insurance agent or agency there; and whether the agent meets clients in the home as a practice.
17. Does a marketing service have to be licensed or registered as an insurance agency if it receives “override commissions” from an insurance company in exchange for recruiting insurance agents to write insurance through the insurance company?
    No. Recruitment of agents for insurance companies is not an activity that may be performed only by insurance agents. The fact that the insurance company pays a so-called “override commission” to the marketing service does not mean that the service is acting as an insurance agency. Therefore, the office of a marketing service is not an insurance agency.
18. May agencies that are wholly owned subsidiary corporations of a publicly traded company listed on a securities exchange be treated the same as the parent and apply for registration rather than licensing?
    No. Florida Statute 626.112(7)(a) provides that “each incorporated agency whose voting shares are traded on a securities exchange ... may file an application for registration in lieu of licensure.” It is the agency itself, which must have shares, traded on a securities exchange. An agency that is a wholly owned subsidiary of another company that is traded on a securities exchange can not register by virtue of its status as a subsidiary.
19. How can a company that is publicly traded on the securities exchange that owns many, perhaps hundreds of agencies, comply with the application requirement for submitting information with regard to every judgment against all of these entities?
    A company that owns many subsidiary companies that are required to be licensed or registered may submit written copies of documents summarizing Legal Proceedings that the company submits to other regulatory authorities such as the appropriate pages from a Securities and Exchange Commission Form 10K filing. Current application should be supplemented by the annual 10K filing and quarterly 10Q filings. Only the pages containing the summary of Legal Proceedings should be filed with the Department.
20. The owners of the agency are both licensed and appointed and have owned an agency since January 1993. However, one owner is selling his share of the business to an unlicensed person. Since the agency has already received the registration, can the agency retain this registration?
    No. The law is specific that the registered agency must remain wholly owned by licensed and appointed agents. Therefore, the registered agency must apply for an agency license. (This does not apply to publicly traded companies.)
21. What is the timeline required to obtain the agency license once the agency loses its qualification for registration?
    The agency must apply for a license within 30 days.
22. An agency is registered and wholly owned by licensed and appointed agents. One of these owners loses all of his/her licenses or appointments. May the agency retain the registration?
    While the statute requires both licensure and appointment for registration, we will handle the loss of licenses or appointments by an owner/agent on a case-by-case basis. If the appointments are lost through oversight of companies, the inadvertent error procedure will apply. In all cases the owner/agent will be provided an opportunity to explain the circumstances surrounding the loss of appointments.
23. What is the department’s procedure if an agency’s application for registration is not approved?
    The department will advise the agency that the application for registration was not approved. The agency will have 30 days from receipt of the notification to submit an application for licensure.
24. Since the primary agent law has been repealed, is it necessary for an agency to have a designated licensed and appointed agent-in-charge of each location?
    Yes. Florida Statute 626.747 states each agency must have a licensed and appointed agent in full-time charge of each location. It is no longer required for the agency to file the primary agent form with the department.
25. May a licensed Florida agent be the agent-in-charge at more than one agency location?
    Yes, if insurance activities requiring licensure as an insurance agent do not occur at any location when the agent is not physically present and unlicensed employees at the location do not engage in any insurance activities requiring licensure as an insurance agent or customer representative.
26. If a branch location does not hold its self out as being a location where insurance is being transacted but only to serve as a place for the agent (from a licensed or registered location) to meet with consumers with whom the agent has made a prior appointment, does the branch have to be licensed or registered?
    If the location is not a business, or is a business that engages in commerce other than the business of insurance (such as a restaurant) and does not hold itself out as being a place where a consumer can go to purchase insurance but may serve as a place for an agent to meet with consumers with whom the agent has made a prior appointment, the location is not an insurance agency and would not be required to have an agency license or registration.
    
    If the location is a branch office of a business that is required to be licensed or registered but for whatever reason the branch office is not licensed or registered, the branch office can not advertise or contain signage or other indicia of being a business that engages in activity as an insurance agency. In addition, an agent from the licensed or registered agency could not have an office in the unlicensed location or be available to solicit or otherwise transact insurance at the unlicensed location with anyone other than an individual with a prior appointment with the agent. The agent can not transact any other insurance at the location that is unrelated to the customer with the prior appointment.
27. What if each branch place of business is only open to the public on certain days or at certain times of the day when the agent-in-charge is physically at the office? Could one agent-in-charge be in charge of each location under these circumstances?
    Yes. Each location would need an agency license or registration.
28. What if each location of a business is open for other activity during normal business hours (9:00 to 5:00, Monday through Friday) such as banking or securities dealing? If it is clear that insurance transactions will only be available at each location during certain designated hours of the day, may one agent be the agent-in-charge of each location?
    Yes. However, insurance can only be transacted by a licensed and appointed agent and each location would need an agency license or registration.
29. If the agent-in-charge changes, must the department be notified of the change?
    Yes. The department must be notified of the change within thirty 30-days. Adding and removing an agent-in-charge can be done by going to www.MyFloridaCFO.com/Agents and logging in to the agency’s account in MyProfile.
30. May one agent be the agent-in-charge of multiple agencies operating in the same location?
    Yes. For example, an entity may for tax or accounting reasons incorporate separate agencies for different lines of insurance but have one agent in one location handling the business. Each corporation would obtain an agency license and the agent would be agent-in-charge of each.
31. If an agent-in-charge resigns his position, can the agency operate without an agent-in-charge?
    No. An agent-in-charge will need to be assigned to agency within 30 days. If an agent-in-charge is not assigned, the agency can not perform duties where a licensed insurance agent would be required.
32. Will the agency appoint the agents working for that agency?
    An agency may not appoint its agents. Agents must be appointed by an insurer or Insurers. However, customer representatives (4-40) and limited customer representatives (4-42) can be appointed through the agency, rather than a general lines agent (2-20), as long as there is a general lines agent in the office full time.
33. Will agencies be issued lines of authority such as “Life?”
    No. Agencies will not be issued lines of authority. However, agencies may transact business only for the lines of authority for which their agents are licensed and appointed.
34. What criteria will be used to disapprove the name of an agency?
    An agency name will be disapproved if it appears that use of the proposed name may mislead or cause harm to the public in any way. Some reasons that will be used to disapprove a name will be terms in a name such as: senior citizen, insurance company, motor club, hospital service plan, state or federal agency, charitable organization, or a name indicating an entity that provides advice and counsel rather than solicits and sells insurance.
35. If the agency has a name that does not meet the department’s criteria for approval, but the agency has had the name for many years, will the department approve the name?
    The department will evaluate the severity of name infraction and make a determination regarding the approval of the name. If the name is disapproved, the agency will be contacted and provided an opportunity to change the name.
36. If an agency violates any part of the insurance code and the violation results in administrative action by the department, will the department take action against all of that agency’s locations?
    No. The administrative action will be taken only against the location where the violation occurred.
37. Does an insurance company that has a Certificate of Authority in Florida have to get registered or licensed as an insurance agency if they have employee agents at their headquarters?
    No. The definition of insurance agency in Florida Statute 626.015(8) excludes insurers.
38. If an insurance company owns or operates branch locations where employees of the insurer work as insurance agents to sell and service the company’s policies, do these locations have to be licensed or registered?
    It depends. If the branch location only houses employee agents who are transacting insurance with the general public, it is an insurance agency that must be licensed or registered. If it is an insurance company branch that houses employee agents as well as non-agent employees who handle traditional insurance company operations such as underwriting, adjusting, claims payment, actuarial services, policy form and rate filings, asset management, etc, it would fall within the exception of insurers from the definition of insurance agency and would not be required to obtain an agency license or registration.
39. Will a carrier be required to have a copy of the agency’s license or registration on file in order to pay them commissions?
    No, however, carriers are reminded that they must continue to comply with long-standing provisions of the Florida Insurance Code regarding the payment and sharing of commissions. Those provisions can be found at Florida Statutes 626.753, 626.794 and 626.838.
40. Can an agent receive commissions from or share with an unlicensed or unregistered agency?
    Yes. The law does not prohibit agents from receiving commissions from or sharing commissions with an agency they work for that has not obtained a license or registration.
41. In general, does the insurer have the responsibility to insure that the agencies they do business with in Florida have a valid agency license or registration?
    No. Compliance with the insurance agency licensure law currently rests with individuals, firms, partnerships, corporations, associations or other entities engaging in insurance agency activities.
42. Does an insurance agency that is licensed and located in another state have to be licensed or registered as an agency in Florida if it transacts insurance in Florida?
    Yes.
43. If an agency has locations in more than one state, could the agency hold both a resident and nonresident agency license?
    Yes. Since each agency location is being licensed, the resident or nonresident license will be determined by the specific location. Therefore, an agency could hold both a resident license if it has a physical location in Florida, and a nonresident license for an out of state location that is conducting business with Florida consumers in this state.
44. If a nonresident Florida agent spends winter months in Florida, will the agent have to obtain an agency license in Florida if the agent sells any insurance while living in Florida?
    It depends. If an agent rents office space and advertises that it is an agency, yes. The agent would have to have a resident insurance agency license for that location. If people in the nonresident agent's condominium and community know that he or she is an agent and seek assistance, the agent would not have to have a license or registration. There are many variations of how an agent may actually engage in business as an insurance agent while in Florida and these will have to be handled on a case-by-case basis. Contact the department’s Help Line at 850-413-3137 for further assistance.
45. If a nonresident agent lives temporarily in Florida, can the agent be the agent-in-charge of the Florida agency and the agent-in-charge of the nonresident agency also?
    Yes.
46. If a funeral director or direct disposer, or an employee of a funeral establishment that holds a certificate of authority under Florida Statute 497.058 is licensed to sell life insurance policies covering the expense of funeral services and products, does the funeral establishment have to be licensed or registered as an insurance agency?
    Yes. Every location where an insurance agent engages in the business of insurance is an insurance agency and every insurance agency is required under Florida Statute 626.112 (7) (a), to obtain an insurance agency license or registration. There is no exemption for agents that work at funeral establishments or for agents that work for any other business that primarily engages in business transactions unrelated to insurance such as banks and securities broker-deals.
    
    However, per Florida Statute 626.785(1)(d), a life insurance agent that is not affiliated with a funeral establishment may obtain a preneed license with the Bureau of Funeral and Cemetery and may contract with a funeral establishment to sell a preneed contract, “…limited policies of insurance covering the expense of final disposition or burial of an insured in the amount of $12,500...” Therefore, per Florida Statute 626.112(7)(a), the life insurance agent would be required to obtain an insurance agency license or registration, there are no exemptions for agents that contract with funeral establishments.
47. Can an agent pay a fee to an unlicensed person for referrals of potential clients?
    Yes. As long as it complies with Florida Statute 626.112(8) which states “No insurance agent, insurance agency, or other person licensed under the Insurance Code may pay any fee or other consideration to an unlicensed person other than an insurance agency for the referral of prospective purchasers to an insurance agent which is in any way dependent upon whether the referral results in the purchase of an insurance product.”
    
    To summarize, it is OK to pay an unlicensed person for every referral. If you only pay that unlicensed person for referrals that result in the sale of an insurance product, it violates the law.
48. If a credit card company charges a 2% fee for payments of policies/premiums, can the agency charge the consumer that fee for reimbursement?
    Yes, but only to the extent of the fee that the credit card company charges to the agency.
49. Can an agent/agency charge a fee in addition to commission for servicing accounts.
    In specific circumstances, yes. Florida Statute 627.7295(5) permits an agent to charge a $10 per policy fee for PIP/PD policies only. The statute reads “A licensed general lines agent may charge a per-policy fee not to exceed $10 to cover the administrative costs of the agent associated with selling the motor vehicle insurance policy if the policy covers only personal injury protection coverage as provided by s. 627.736 and property damage liability coverage as provided by s. 627.7275 and if no other insurance is sold or issued in conjunction with or collateral to the policy. The fee is not considered part of the premium.”
    
    Florida Statute 626.593 applies to group health insurance coverage and states as follows: “No person licensed as an insurance agent may receive any fee or commission or any other thing of value in addition to the rates filed pursuant to chapter 627 for examining any group health insurance or any group health benefit plan for the purpose of giving or offering advice, counsel, recommendation, or information in respect to terms, conditions, benefits, coverage, or premium of any such policy or contract unless such compensation is based upon a written contract signed by the party to be charged and specifying or clearly defining the amount or extent of such compensation and informing the party to be charged that any commission received from an insurer will be rebated to the party in accordance with subsection (3). In addition, all compensation to be paid to the insurance agent must be disclosed in the contract.” Any other charge would be considered illegal dealings in premiums and would be a violation of Florida Statute 626.9541(1)(o) and 627.403.
    
    A consulting fee CAN NOT be charged where the fee is part of the consideration for insurance coverage, as that fee would be considered additional premium. HOWEVER, a consulting fee can be charged for services not related to placing the coverage if there is a SEPARATE consulting contract between the agent and the insured. If a consulting fee is charged, the insured must fully understand that he is entering into a separate contract and paying a separate consideration in advance of the performance or consulting service. The services rendered must be other than those normally provided by an insurance agent in connection with the solicitation or effectuation of the insurance coverage.
50. How long do I have to maintain records?
    Florida Statute 626.561(2) states “The licensee shall keep and make available to the department or office books, accounts, and records as will enable the department or office to determine whether such licensee is complying with the provisions of this code. Every licensee shall preserve books, accounts, and records pertaining to a premium payment for at least 3 years after payment; provided, however, the preservation of records by computer or photographic reproductions or records in photographic form shall constitute compliance with this requirement. All other records shall be maintained in accordance with Florida Statute 626.748 which states: “Every agent transacting any insurance policy must maintain in his or her office, or have readily accessible by electronic or photographic means, such records of policies transacted by him or her as to enable the policyholders and department to obtain all necessary information, including daily reports, applications, change endorsements, or documents signed or initialed by the insured concerning such policies.” The 3-year requirement shall not apply to insurance binders when no policy is ultimately issued and no premium is collected.”
    
    Viatical settlement brokers must maintain records in accordance with Florida Statute 626.9922(2), which states “All accounts, books and records, documents, files, contracts, and other information relating to all transactions of viatical settlement contracts, life expectancies, or viatical settlement purchase agreements made before July 1, 2005, must be maintained by the licensee for a period of at least 3 years after the death of the insured and must be available to the office or department for inspection during reasonable business hours.”