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Purchasing Insurance header image

Do you want to purchase insurance coverage but need information concerning the process and how to protect yourself? The topics below will help you understand the process of purchasing insurance.

Verify Before You Buy

Make sure that the company, broker or agent is licensed to do business in Florida before you sign a contract or write a check. It is illegal for companies or individuals to market insurance in Florida without a license. Agents must be licensed and must have active appointments with specific companies in order to legally sell insurance products. Use the links below to verify through our records that the entity is authorized and licensed to transact business in Florida or with Florida residents.

Regulatory Actions Against Companies

If you suspect an entity is not authorized or licensed to transact insurance in Florida, from Florida or with residents of Florida, please notify our office. Call 1-877-MY-FL-CFO (1-877-693-5236 to report suspect unlicensed activity.

Rating Services

Six major credit agencies determine insurers' financial strength and viability to meet claim obligations.

They are:

Please Note: These are independent insurance company rating organizations. Their appearance on the department’s website is meant for the convenience of the department’s consumers and is not an endorsement of either organization by the Department of Financial Services.

Factors considered include company earnings, capital adequacy, operating leverage, liquidity, investment performance, reinsurance programs, and management ability, integrity and experience. A high financial rating is not the same as a high consumer satisfaction rating. The ratings generally are shown as A++ (being the best) to D or E.

Rating services develop their own criteria for rating insurance companies. For instance, A.M. Best doesn't rate insurance companies with less than five years of financial data. Since the rating companies develop their own rating criteria, an insurance company's rating may be different between rating services.

DemoTech - for newer companies

  • Not a predictor of future performance

  • Doesn't take into account consumer issues

Insurance company investment factors can impact their ratings when the stock market takes a downturn.

Example: 2001 stock market downturn after 9/11.

How to Select an Insurance Agent

When selecting an agent, choose one who is licensed to sell insurance in Florida. Some agents have professional insurance designations such as the following:

CEBS..... Certified Employee Benefits Specialist

CFP......... Certified Financial Planner

ChFC...... Chartered Financial Consultant

CIC......... Certified Insurance Counselor

CLU........ Chartered Life Underwriter

CPCU..... Chartered Property and Casualty Underwriter

LUTCF.....Life Underwriting Training Council Fellow

RHU........Registered Health Underwriter

Make sure you select an agent with whom you feel comfortable and who will be available to answer your questions. Remember: An agent may represent more than one company. To verify whether an agent is licensed, call the DFS Consumer Helpline toll-free at 1-877-MY-FL-CFO (1-877-693-5236).

How to Select an Insurance Company

When selecting an insurance company, it is wise to know that company’s financial rating. Several organizations publish insurance company ratings and resources are available in your local library and on the internet. These organizations include: A.M. Best Company, Standard & Poor’s, Weiss Ratings Inc., Moody’s Investors Service, Demotech and Duff & Phelps. Companies are rated on a number of elements, such as financial data (including assets and liabilities), management operations and the company’s history.

Before buying insurance, verify whether a company is licensed to sell insurance in Florida by calling the DFS Consumer Helpline toll-free at 1-877-MY-FL-CFO (1-877-693- 5236). Be sure to have the full, legal name of the insurance company when you call.

Application Process

The application process can vary depending on the type of insurance being purchased. However, in all cases the questions on the application must be answered correctly. If incorrect information is given on an application, whether intentional or not, the policy may be rescinded and a claim denied at a later date. If the agent completes the application, make sure you review all the questions and answers before you sign. Also, keep in mind the quote you receive from the agent is an estimate and may be changed by the insurance company, depending on current rating factors and underwriting guidelines.

Things to remember during the application process.......

Auto Insurance

  • Make sure all licensed drivers in your household are listed on the application.
  • The agent may need to inspect the vehicle or take pictures before coverage can be provided.
  • The agent may need a copy of your prior insurance policy.
  • The agent may ask for the name and social security number for all listed drivers.

Life and Health Insurance

  • You may be asked to take a physical or blood test.
  • Keep in mind that coverage may not begin until approved by the insurance company.

Homeowners Insurance

  • The agent may ask to take pictures of your home.
  • The agent may ask for documentation to prove any updates to the plumbing, wiring, or heating/air conditioning.
  • The agent may ask you to have your home inspected for mitigation credits.
  • The agent may ask for a copy of your prior insurance policy.
  • The agent may ask for the name and social security number for all residents of the household.
Underwriting Process

Once your application for insurance is received by the insurance company, they decide if the applicant or the property is eligible for coverage. All insurance companies use guidelines to determine eligibility. When the underwriting process is complete the company determines the final premium.

The company may review some or all of the following items, depending on the type of policy:

Auto Insurance

The company reviews the type of vehicle, the age of the vehicle, the age of the drivers, the experience of the drivers, the violations received by all drivers, the number of accidents for all drivers, where the vehicle is kept, how the vehicle is used, and how many miles are driven each year.

Homeowners Insurance

The company reviews the construction of the home (frame, brick, etc.), the year the home was built, the age, type, and construction of the roof, where the home is located, how the home is used, the square footage, whether the home has items that qualify for hurricane mitigation credits, prior claims history, and the existence of prior insurance.

Life Insurance

The company may review your health history, your age, and your occupation to determine eligibility. The company may elect to cover you but exclude benefits if you die from certain illnesses (called riders or exclusions).

Health Insurance

There are instances where an insurance company must issue a health insurance policy regardless of the factors listed here. However, there are also instances where the company will base their decision to cover you on the following: Your age, your health history, and your occupation. They will normally ask for proof of any previous health insurance as well which may satisfy any pre-existing condition exclusion in the policy. The company may elect to cover you but exclude benefits for certain illnesses (called riders or exclusions).


Visit our Consumer Alerts page for more information and also view our list of common Fraud & Scams.