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Volume 5, No. 9 - September 2016

Compliance Corner

This section has been created to assist you in keeping your insurance business in compliance. The items are intended as reminders only. Note: Division publications may include references to the Florida Statutes and/or the Florida Administrative Code. The laws noted in our publications are/were in effect at the time of publication but may have been repealed, amended or replaced and new laws may have been enacted subsequently.

Navigation Compliance Topic of the Month ~ Navigators

What is a navigator?
"Navigator" means an individual authorized by the Federally-Facilitated Exchange (Exchange), also known as the Marketplace to serve as a navigator, or who works on behalf of an entity authorized by the Exchange to serve as a navigator, pursuant to 42 U.S.C. s. 18031(i)(1), who facilitates the selection of a qualified health plan through the exchange and performs any other duties specified under 42 U.S.C. s. 18031(i)(3).

To be registered as a navigator, the individual must:

  • Be a natural person at least 18 years of age.
  • Be a United States citizen or legal alien who possesses work authorization from the United States Bureau of Citizenship and Immigration Services.
  • Submit the application for registration by answering all of the questions and paying the fees to complete the online application.
  • Provide official certification that he or she has successfully completed all required training by the federal government and has been certified by them as a Marketplace Navigator. The certificate of completion that states it is "not an official certification record" is not sufficient. Please provide the official certificate that has the navigator's unique ID number assigned by the HHS (U.S. Department of Health and Human Services) and the organization where they are employed.
  • Submit fingerprints for a criminal background check.
  • Certain crimes would either permanently bar an individual from registration or disqualify an applicant for specified periods.

More information can be found on the qualifications page by clicking here.

Navigators are prohibited from:

  • Soliciting, negotiating, or selling health insurance;
  • Recommending the purchase of a particular health plan or represent that one health plan is preferable over any other;
  • Recommending or assisting with the cancellation of insurance coverage purchased outside the Exchange;
  • Receiving compensation or anything of value from an insurer, health plan, business, or consumer in connection with performing activities as a navigator, other than from the Exchange or an entity or individual who has received a navigator grant under the PPACA.

How do I apply to become registered as a navigator?
To apply for registration as a navigator, you must go to MyProfile and apply. If you do not already have a MyProfile account, you will need to create one first.

If I'm interested in becoming a navigator, who should I contact?
You should contact the Navigator entities that are awarded grants by the federal government.

Certified Marketplace Application Counselors are not required to be registered as a navigator by the Florida Department of Financial Services (DFS) as they are not regulated by DFS. If you are a certified Marketplace Application Counselor, please do not apply for registration as a Florida navigator.

Unlicensed Agency Personnel

Unlicensed personnel have limited discretion as to how they can support the operations of an insurance agency. Permitted and prohibited activities are described in Rule Chapter 69B-222, F.A.C. Incidental activities and compensation are two of the most important points to remember when employing unlicensed personnel. Incidental activities as described in the rules cannot exceed 10% of an employee's overall activities and compensation cannot be made based on the individual production of the unlicensed person. The following actions are never allowable by unlicensed personnel:

  • Comparing insurance products; advising as to insurance needs or insurance matters; or interpreting policies or coverage.
  • Binding new, additional or replacement coverage for new or existing customers; or binding coverage on or recording additional property under existing policies.
  • Soliciting the sale of insurance by telephone, in person, or by other communication. However, the unlicensed person may telephone persons to set appointments for licensed and appointed agents, customer representatives, or to obtain basic policy information as to existing insurance coverage. The unlicensed person may not engage in a substantive discussion of insurance products.

Transacting insurance without the appropriate license and appointment, regardless of the line of business, is a third-degree felony, punishable as provided in s. 775.082, s. 775.083, or s. 775.084, F.S.

Title Insurance Agencies - Consumer Inquiries

We are providing brief regulatory guidance about a few topics related to title insurance activities that we've receive consumer inquiries about:

How long do I have after a closing to record the deed and mortgage?

The liability to the insurance company remains open ended until the deed and the mortgage are properly recorded. Therefore, it is in everyone's best interest to record these documents as soon after the closing as possible. Failing to record the documents could create a claim for the insurer, which could put the agency in violation of the Florida Statutes, as well as jeopardize the agency's contract to represent that title insurer.

How do I properly record a rebate my agency is giving?

Both the premium and the rebate must be disclosed as separate items on the Closing Disclosure form.

Can I charge for the examination of the title records?

The examination or evaluation of records to determine the insurability of a property is considered part of the primary title services, which are a component of the premium and a separate fee is not charged to the consumer.

Can we charge for the storage of the closing records?

The Florida Statutes require the title insurance agency and the title insurance company to retain copies of the records related to the issuance of the title insurance policy and the funds disbursed from the escrow account. These fees should not be passed on to the consumer as separate line item charges. The title insurance agency may include the cost of storage of these records in the agency's calculations for the closing services fee.

To ensure you and your agency are complying with the Florida Insurance Code, we recommend all licensees become familiar with Florida Statutes Chapter 626, Part V - Title Insurance Agents, Rule Chapter 69B-186, and 69O-186 of the Florida Administrative Code, and the FAQs on this topic available at the Division's website. Compliance questions can be sent to Title@MyFloridaCFO.com.

Late Appointment Renewals

A non-refundable $25 late fee is required in addition to the $60 appointment fee for each appointment renewed late. The late fee must be paid by the appointing entity and cannot be charged back to the appointee. [See s. 624.501, s. 626.331(4), s. 626.381, and s. 648.383, F.S.]

For example, if an appointment expiration date is March 31, 2017, the invoice would become available for payment on March 1, 2017. On April 1, 2017, late fees are assessed, and the invoice remains available for payment until May 15, 2017. On May 16, 2017, if payment has not been received, the appointment is cancelled.

If the appointing entity wishes to reinstate an appointment after the appointment was cancelled for CE Non-Compliance, the appointing entity must pay a $60.00 appointment reinstatement fee to reestablish the prior appointment. If the CE requirement is not met prior to the original appointment’s expiration date, the appointment cannot be reinstated without occurring additional fees.

Other than for an appointment cancellation for CE Non-Compliance, if the appointing entity wishes to backdate an appointment to show no lapse in appointment coverage and the requested appointment date is more than 45 days from the submission date, and is within 24-months from the submission date, a $250 late fee will be assessed. A new appointment submission with the requested effective date must be submitted through the appointing entity's eAppoint account.

If the appointing entity wishes to backdate an appointment more than 24-months, the appointing entity must complete an Affidavit of Insurance Activity While Not Properly Appointed form, found under Miscellaneous Forms on our website at, http://www.myfloridacfo.com/Division/Agents/Licensure/Forms/default.htm, and submit the form per the instruction on the form.

For more information, see s. 626.331(4), s. 626.371, and s. 648.382 of the Florida Statutes

Referral Fees

We receive numerous inquiries weekly about referral fees, and it's been a frequent topic in newsletter articles. We are including it again to provide clarification.

An agent may pay an unlicensed person for referrals of potential clients as long as it complies with s. 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."

Often, licensees ask if they can pay "referral fees, compensation, finder's fee", etc. to other agents for referring business to them. When a licensee provides any compensation to another licensee for the referral of business, it is considered commission sharing. Lawful commission sharing can only take place between like-licensed individual agents. however, commissions can be paid to a licensed insurance agency. For example, to facilitate paying a share of the commission to a general lines agent for the referral of life insurance business, life insurance commissions can be paid to the general lines agent's licensed insurance agency [See s. 626.753, s. 626,794, and s. 626.838, F.S.

Compliance Information

Department licensees and consumers can access compliance information at the Division of Insurance Agent and Agency Services' web page Compliance Information. Additional information is available by type of license at our Frequently Asked Questions web page.