Volume 6, No. 3 - March 2017

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 The laws noted in our publications are/were in effect at the time of publication but may have been repealed, amended or replaced and new laws may have been enacted subsequently.

Compliance Topic of the Month: Requiring Ancillary Coverages/Products Prohibited a.k.a. "Sliding"

It is a violation of the Florida Insurance Code to represent to applicants and insureds that a specific ancillary coverage or product, (i. e., accidental death and dismemberment, towing and rental, motor club, etc.), is required by law in conjunction with the purchase of motor vehicle insurance when such coverage is not required.

It is also a violation to represent to applicants and insureds that the specific ancillary coverage or product is included in the motor vehicle policy without an additional charge when, in fact, an additional charge is applied. Such misrepresentations of ancillary coverages/products constitute "sliding" and these transactions are considered an unfair trade practice.

Additionally, agents and customer representatives must ensure that applicants and insureds understand the purpose for the forms they are signing when purchasing coverages, including any ancillary coverages, products or services.

If it is documented that agents or customer representatives are "sliding" an ancillary coverage or product to applicants and insureds, the Department will take the appropriate administrative action against the licensee. Licensees involved in these types of transactions may be subject to administrative penalty including suspension or revocation of their license.

[See subparagraph 626.9541(1)(z), Florida Statutes]

Bail Bond Agents - Soliciting on Jail Grounds is Prohibited

Several Sheriff's Offices have recently notified the Department they are seeing an increase in bail bond agents or their representatives unlawfully soliciting business on jail or other detention premises in violation of s. 648.44, F.S , The following are examples of unlawful solicitation:

• Distributing bail bond agent or agency business cards.
• Wearing shirts, jackets, pins, patches, or anything on their person that advertises the bail bond agent or agency, including athletic uniforms that have the sponsoring bail bond agent or agency name on the uniform.
• Directly approaching people on the property and asking if they need the services of a bail bond agent.
• Posting a bond at the jail without being contacted by the defendant or the defendant’s family or friends beforehand.
• Parking a vehicle with a magnetic sign, vehicle wrap, or other ad on the vehicle in parking lot of the jail.

Another prohibited practice under the same section of Chapter 648 is wearing any identification other than the license issued by the DFS on the grounds of the jail, courthouse, or other area where prisoners are confined.

Making Charitable Contributions "on behalf of" Potential or Existing Clients

We are occasionally asked whether a licensee can advertise it will make a charitable contribution on behalf of a potential or existing client. In short, the answer is no. The Department would never deter its licensees from making philanthropic contributions, however, using those contributions to lure new clients or retain existing clients is considered an unlawful inducement to purchase insurance. Although the client would not receive a direct monetary gift, the act of advertising the contribution and linking it to a quote for or purchase of insurance meets the criteria of an unlawful inducement.

Agencies are free to advertise that they contribute to a specific interest or charity, but cannot link those contributions to a potential or existing client.

Working in the Industry After Being Suspended or Revoked

The Florida Insurance Code clearly states that it is unlawful during the period of suspension or revocation of a license or appointment for the former licensee to engage in or attempt or profess to engage in any transaction or business for which a license or appointment is required. This prohibition extends until the license is reinstated or, if revoked, a new license issued. Furthermore, the former licensee or appointee may not directly or indirectly own, control, or be employed in any manner by an agent, agency, adjuster, or adjusting firm.

Any former licensee or appointee in violation of this law commits a felony of the third degree, subjecting themselves to further action by the Department up to and including criminal prosecution.

Before hiring someone to work at your agency or firm we suggest you check to ensure that their license is not currently suspended or revoked.

[See Sections 626.015 and 626.641, Florida Statutes]

Division Website - Compliance Information

There is a section on our website solely dedicated to compliance information. The section also provides consumers and licensees with an overview of the investigative process and many functions performed by our Bureau of Investigation. We encourage you to visit this section of our website and come back often as we update and add more information to it. You can visit the compliance site at www.MyFloridaCFO.com/Division/Agents/Compliance.

Title Agency Data Call 2017

Title insurance agencies are required to submit information to the Florida Office of Insurance Regulation (OIR) under the data call required by section 627.782(8), Florida Statutes. Title agencies have until June 1, 2017 to make their submission to the OIR. The OIR will send an email to each licensed title agency in Florida to remind them of the new law with instructions on how to complete the process accurately.

The Title Agency Data Call is performed by the title agency by first downloading the template from the OIR website to complete offline. To do this, the agency will need to create an account and subscribe to your agency in the Data Collection and Analysis Modules (DCAM) used by the OIR, which is located at https://apps8.fldfs.com/DCAM/Logon.aspx.
(The user's guide for DCAM is located at: https://apps8.fldfs.com/DCAM/Help/DCAMUserGuide.pdf)

Once the agency's data template form is completed and the agency is ready to certify it is accurate, the agency must upload the form to the OIR before the deadline, June 1, 2017 .

The data template has seven tabs or worksheets:

  1. Version: includes the OIR contact information and reporting date reminder
  2. Instructions: data template must be downloaded from DCAM for the purpose of reporting information
  3. Report_Lines: Two columns extend down a series of questions and required responses (enter either text or numeric in the two columns, as shown)
  4. Schedule A: Additional agency information
  5. Schedule B: Agent activities
  6. Schedule C (Residential): Title agent statistical information submission for 1-4 residential units
  7. Schedule C (Commercial): Title agent statistical information submission for commercial units

Each agency's submission must contain a Filing Certification signed by an agency officer (electronic signature accepted), stating the information provided is accurate to the best of their knowledge and belief. A sample copy is available on the OIR's website at: www.floir.com/siteDocuments/CertificationOfTitleDataSubmissionExample.pdf

The agency may include a cover letter, but this is an optional component for the filing.

Each agency is encouraged to include any additional or optional information that is deemed important to the overall submission. These optional items may be uploaded as PDF documents under the "Other Information/Documents" component.

It is important to know that the agency's submission is not considered to be complete until the agency receives an email receipt showing the agency's file log number.

If you have any questions regarding this filing process, please contact the OIR's Market Data Collections Unit at 850-413-3147 or via email: TitleAgencyReporting@floir.com.

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.

 

Note: Some information in archived articles may now be out-of-date or superseded by changes in Florida law. Please be sure you refer to the most current law.