Industry Warning: Automobile Dealerships
Recently, the Department of Financial Services (DFS) has
uncovered increased instances of unlicensed insurance
transactions by automobile dealership personnel. Along with the
Department of Highway Safety and Motor Vehicles, DFS is
providing this informational notice on the legal requirements
regarding insurance transactions.
It is illegal to solicit or transact automobile insurance at
dealership locations without possessing a property and casualty
license or a personal lines agent license. Last year, the
unlicensed transaction of insurance was elevated to a third
degree felony. In addition to the possibility of the unlicensed
person(s) facing felony charges for transacting insurance
without a license, the dealership could jeopardize any licenses
that have been issued by the DFS, such as a warranty or service
agreement license, for allowing personnel to engage in the
unlicensed transaction of insurance. DON’T SELL INSURANCE
ILLEGALLY
Below are important Florida statutes on this topic:
- Section 624.11(a), Florida Statutes, states, “No person
shall transact insurance in this state, or relative to a
subject of insurance resident, located, or to be performed
in this state, without complying with the applicable
provisions of [the] code.”
- Section 626.112(1)(a) Florida Statutes states, “No
person may be, act as, or advertise or hold himself or
herself out to be an insurance agent … unless he or she is
currently licensed by the department and appointed by an
appropriate appointing entity or person. ...”
- Section 626.112(1)(b) Florida Statutes states in part,
“the solicitation of insurance is the attempt to persuade
any person to purchase an insurance product by:
- Describing the benefits or terms of insurance
coverage, including premiums or rates of return;
- Distributing an invitation to contract to
prospective purchasers;
- Making general or specific recommendations as to
insurance products;
- Completing orders or applications for insurance
products;
- Comparing insurance products, advising as to
insurance matters, or interpreting policies or
coverages; …”
- Section 626.112(9) states, “Any person who knowingly
transacts insurance or otherwise engages in insurance
activities in this state without a license in violation of
this section commits a felony of the third degree. …”
Download and print the rack
card.
If you have any questions, please contact the Florida
Department of Financial Services, Division of Agent and Agency
Services, Bureau of Licensing Helpline: 1-850-413-3137.
10/18/2007