Volume 2, No. 7 - November 2011

Compliance Corner

We continue to see a pattern of noncompliance in the areas noted below. This section has been created to assist you in keeping your insurance business in compliance. The items are intended as reminders only and are not necessarily the exact text of the Florida Statutes or Florida Administrative Code. The legal cites have been provided for your further reference.

Public Adjusters - Citizens Property Insurance Corporation Claims

In the June 2011 issue of The Pulse and an email sent to all Florida licensed public adjusters on June 13, 2011, we provided information about new laws taking effect that would impact the business of public adjusting. In both communications, we included information that effective May 17, 2011, subsection 627.351(6)(a), Florida Statutes, was amended to add the following provision:

6. For any claim filed under any policy issued by Citizens Property Insurance Corporation, a public adjuster may not charge, agree to or accept any compensation, payment, commission, fee or other thing of value that is greater than 10% of the additional amount actually paid in excess of the amount originally offered by Citizens on the claim.

The Florida Department of Financial Services' Division of Agent and Agency Services received inquiries regarding this law shortly after it became effective and we continue to receive inquiries regarding this issue.

From the plain reading of this statute, our position is that a public adjuster can contract with a Citizens policyholder at any time allowed by law. A public adjuster cannot charge more than 10% of any amount paid in excess of the original offer that is made by Citizens. If a public adjuster enters into a contract prior to Citizens making an offer, then the "original offer" is when Citizens makes its first offer.

We believe it is important to emphasize the language: "For ANY claim filed under ANY policy of the corporation, a public adjuster may not charge, agree to, or accept any compensation, payment, commission, fee, or other thing of value greater than 10%...." This language addresses any type of policy and any type of claim filed on behalf of a Citizens policyholder. The statute does not distinguish between new, supplemental, or reopened claims.

The Division's Bureau of Investigation recently became aware of numerous public adjusting contracts being submitted to Citizens Property Insurance Corporation that contain a fee amount of 20%. Several contracts were also submitted to Citizens that contained a waiver form that included the text from subsection 627.351(6)(a)6., F.S., and a disclaimer signed by the policyholder that they were waiving their rights under the referenced statutory provision and agreeing to a 20% fee.

The Department believes subsection 627.351(6)(a)6., F.S., does not confer any rights to consumers, but rather, imposes only restrictions on adjusters. Therefore, since a waiver involves the voluntary surrender of a known right, the use of any type of waiver cannot serve as a defense to charging a fee in excess of the limits proscribed by subsection 627.351(6)(a)6., F.S., because a consumer has no rights to waive under that provision.

Submitting a contract for public adjusting services that exceeds 10% on a policy issued by Citizens Property Insurance Corporation or attempting to use any document signed by the policyholder wherein they agree to pay a higher fee for public adjusting services proscribed by law is considered a violation of the Florida Insurance Code. The Department will pursue action against any public adjuster or public adjusting firm that violates this provision of the law.

[See 626.877 and 627.351(6)(a), Florida Statutes]

Surplus Lines Agents - Don't Forget to Join FSLSO

Any individual, licensed as a surplus lines agent under sections 626.927 and 626.9272, Florida Statutes, shall be deemed a member of the Florida Surplus Lines Service Office (FSLSO), a not-for-profit, self-regulating association. Upon receiving your Florida surplus lines agent license, you will need to complete a New Agent Membership form by visiting: https://slip.fslso.com and selecting "Register".  Also, don't forget to self-appoint your surplus lines agent license (see below).

Appointments and the Easy Way to Do Them Online

Appointments must be completed online (except bail bond agents).  Depending on the type of license and appointment, the steps to complete the appointment may be different.  Please view the appropriate category below for instructions.

Customer Representatives: Customer representatives (4-40) must be appointed through the MyProfile account of the supervising general lines agent (2-20) OR the licensed/registered insurance agency where the customer representative works. To do this:

  1. Go to MyProfile and log in to the supervising general lines agent's or the agency's account.
  2. Select the "Access eAppoint" button under "Apply". If you have never used eAppoint, you must first register and will need to select "Register to become an appointing entity".
  3. Once in the eAppoint Workbench, select the required tab (New Appointment, Renew Appointment, or Terminate Appointment) and follow the instructions on the page. You will need to remit the appropriate appointment fee(s). Appointments must be renewed every 24 months during the birth month for the appointee.

Self-Appointing Surplus Lines Agent, Viatical Settlement Broker, Public or Independent Adjuster: Self-appointing surplus lines agents, viatical settlement brokers, public or independent adjusters must log in to their own MyProfile account and complete an appointment. To do this:

  1. Go to MyProfile and log in to your account.
  2. Select the "Access eAppoint" button under "Apply". If you have never used eAppoint, you must first register and will need to select "Register to become an appointing entity".
  3. Once in the eAppoint Workbench, select the required tab (New Appointment, Renew Appointment, or Terminate Appointment) and follow the instructions on the page. You will need to remit the appropriate appointment fee(s). Appointments must be renewed every 24 months during the birth month for the appointee.

Adjusting Firm Appointing a Public or Independent Adjuster: Adjusting firms that are attempting to appoint a public or independent adjuster will use eAppoint by logging in with an email address and password. To do this:

  1. Go to eAppoint at https://iportal.fldfs.com/eappoint. If you are having a problem logging in, try clicking the "Retrieve lost password" link on the left side of the screen. If this does not resolve the issue, please contact our Licensing Help Line at (850) 413-3137.
  2. Once in the eAppoint Workbench, select the required tab (New Appointment, Renew Appointment, or Terminate Appointment) and follow the instructions on the page. You will need to remit the appropriate appointment fee(s).  Appointments must be renewed every 24 months during the birth month for the appointee.

All Other Entities: All other entities will use eAppoint and will log in using an e-mail address and password. To do this:

  1. Go to eAppoint at https://iportal.fldfs.com/eappoint. If you are having a problem logging in, try clicking the "Retrieve lost password" link on the left side of the screen. If this does not resolve the issue, please contact our Licensing Help Line at (850) 413-3137.
  2. Once in the eAppoint Workbench, select the required tab (New Appointment, Renew Appointment, or Terminate Appointment) and follow the instructions on the page. You will need to remit the appropriate appointment fee(s). Appointments must be renewed every 24 months during the birth month of the appointee.

Stay Up-to-Date and Keep Your Information Up-to-Date!

Licensees are reminded to update any change in their name, addresses (including email) or phone numbers by logging in to their MyProfile account. If you also have an agency license/registration, don't forget to log in to your agency's MyProfile account and update it as well. It is also a good practice to regularly check your MyProfile account(s) for any messages that we have sent you that you may have missed in your email. Add our MyFloridaCFO.com domain to your email software's Trusted or Safe Senders List to ensure you receive all notifications from us.

[See sections 626.551 and 648.421, Florida Statutes]

 

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