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Department Home | Agent and Agency Home | Insurance Insights Home

  Vol. 10, No. 2 - Fall 2021

In The Know


Customer Representatives - Compliance Reminder

The Governor's Executive Order which allowed 4-40 Customer Representatives to work at remote locations expired June 26, 2021. The statutory requirements for both 4-40 customer representatives and their supervising general lines agent and the agency they are employed by are in full effect.

The Department has received inquiries asking for clarification of the laws that regulate customer representatives and the agency they are employed by. We are providing the following to prevent confusion on the part of our licensees.

Customer Representatives. - Florida Statutes Chapter 626 - Part II

Following are the statutes specific to customer representatives currently in effect:

626.7351 Qualifications for customer representative’s license.

The department shall not grant or issue a license as customer representative to any individual found by it to be untrustworthy or incompetent, or who does not meet each of the following qualifications:
(5) The applicant will be employed by only one agent or agency and the agency will appoint one designated agent within the agency who will supervise the work of the applicant and his or her conduct in the insurance business, and the applicant will spend all of his or her business time in the employment of the agent or agency and will be domiciled in the office of the appointing agent or agency as provided in s. 626.7352, F.S.

626.7352 Customer representative's office.

A customer representative shall be housed wholly and completely within the actual confines of the office of the agent or agency whom he or she represents, together with any such furniture, books, records, equipment, and paraphernalia necessary for the conduct of such insurance business. The customer representative shall not maintain any such office or furniture, books, records, equipment, or paraphernalia at any other address or location, nor shall he or she maintain or make use of any other quarters, space, or address, for the purpose of the conduct of such business. No advertising, letterhead, or telephone listing of the customer representative shall indicate any business address other than that of the agent or agency by whom he or she is employed. No customer representative may be employed from any location except where an agent licensed to write such lines spends his or her full time in charge of such location.

626.7354 Customer representative’s powers; agent’s or agency’s responsibility.

(4) A customer representative shall not engage in transacting insurance outside of the office of his or her agent or agency.

We've been asked for clarification whether some customer representative duties fall under the above laws, such as underwriting activities or agency bookkeeping, accounting or other miscellaneous responsibilities represent an exception to the prohibition of a customer representative working from a remote location.

Those type of activities must occur at the agency or the supervising general lines agent's office as the laws prohibit a customer representative from "maintaining" any other space, have books or records (including electronic records), at a remote location.

Florida Statues 626.7351 states the customer representative "will spend all of his or her business time in the employment of the agent or agency and will be domiciled in the office of the appointing agent or agency as provided in s. 626.7352, F.S.".

Further, all activities conducted by a customer representative must take place at the place of business of their supervising general lines agent, even those that are not defined as " transacting insurance" per s. 626.7352, F.S. This law states all activities related to the customer representative's duties may only be conducted at the supervising general lines agent's office. "Duties" would include any type of work assigned to the customer representative including those outside the scope of their license authority.

General lines agents may conduct insurance business from a residence provided they meet the requirements of s. 626.749, F.S. In that case, the customer representative would be allowed to work from the supervising general lines agent's home office.

Questions about the regulation of these laws can be directed to AskDFS@MyFloridaCFO.com.


Senate Bills 76 and 1598 - Highlights

Public Adjusters and Public Adjusting Firms - Important Changes Effective July 1, 2021

We have highlighted changes to some of the laws public adjusters should be aware of. All laws cited were effective July 1, 2021.

Public Adjusting Firms - License Required

  • As of July 1, 2021, all public adjusting firms must obtain a license from the Department.
  • Our Bureau of Licensing continues to make updates to our electronic license application process to allow firms to apply for a license. At this time, we expect the application to be available by the end of this year.
  • All firms holding authority as an appointing entity received an email from Agent Licensing reflecting the information above. An email will be sent to those firms when the application is available.
  • There is no cost for the license.

Public Adjusting Contracts

  • As of July 1, 2021, all public adjusting firm contracts must include verbiage stating the consumer/insured has 10 days from the date of the contract's effectuation to request cancellation. Effectuation of the contract means the contract is fully completed and signed by all parties as required by Rule 69B-220.051(6), F.A.C.
  • The new law requires the name of the party the consumer/insured must notify to cancel the contract. The contract must list the name of the the public adjuster who signed the contract and may also include the name of the adjusting firm.
  • Requires that the public adjuster's written estimate of loss must include an itemized, per-unit estimate of the repairs. The public adjuster must provide the estimate to the claimant or insured within 60 days after the execution of the public adjuster contract.

Other Changes to Public Adjuster Laws

  • Changes to public adjuster laws under new section s. 626.854(20)(a), F.S.:
  • A public adjuster (PA), PA apprentice, or person acting on behalf of a PA or PA apprentice, is prohibited from offering financial inducements for (1) allowing a roof inspection of residential property, or (2) making an insurance claim for roof damage and prohibits them from offering or accepting consideration for referring services related to a roof claim. Each violation subjects the licensee to up to a $10,000 fine. Unlicensed persons who are not otherwise exempted from PA licensure commit the unlicensed practice of public adjusting when they do these prohibited acts and are subject to a $10,000 fine per-act and the criminal penalty for unlicensed activity (3rd degree felony).
  • A property insurance claim or reopened claim must be provided to the insurer within two (2) years of the date of loss. A supplemental claim is not barred if notice is given while the claim it supplements remains open.
  • Prevents the filing of a claim, supplemental claim, or reopened claim under a property insurance policy unless notice of the claim, supplemental claim, or reopened claim is provided to the insurer within two (2) years of the date of the loss.
  • Prohibits persons other than a public adjuster or attorney from advertising, providing advice, or assisting with claims adjusting on behalf of a public adjuster, insured, or third-party claimant.

Independent Adjusting Firms - License Required

  • As of July 1, 2021, all independent adjusting firms must obtain a license from the Department.
  • Our Bureau of Licensing continues to make updates to our electronic license application process to allow firms to apply for a license. At this time, we expect the application to be available by the end of this year.
  • All firms holding authority as an appointing entity received an email from Agent Licensing reflecting the information above. An email will be sent to those firms when the application is available. There is no cost for the license.

    Effective Date: July 1, 2021 - Laws of Florida, Ch. 2021-77 and Ch. 2021-104

Contractors

Recent legislation created s. 626.854(15), F.S. and prohibits licensed contractors and subcontractors from advertising, soliciting, offering to handle, handling, or performing public adjuster (PA) services without a license. The prohibition does not prohibit the contractor from recommending that the consumer consider contacting his or her insurer to determine if the proposed repair is covered by insurance except as it may be related to s. 489.147, F.S. while participating in those activities.

The contractor may discuss or explain a bid for construction or repair of covered property with the residential property owner who has suffered loss or damage covered by a property insurance policy, or the insurer of such property, if the contractor is doing so for the usual and customary fee applicable to the work to be performed as stated in the contract between the contractor and the insured.

Effective Date: July 1, 2021 - Laws of Florida, Ch. 2021-77

Managing General Agents

Recent legislation made changes to s. 626.7452, F.S., provides that managing general agents (MGAs) are subject to examination authority by the Florida Office of Insurance Regulation (OIR). The law defines the acts of the MGA are considered to be the acts of the insurer on whose behalf it is acting.

Effective Date: July 1, 2021, Laws of Florida, Ch. 2021-77

More detailed analysis for this bill is located in this newsletter under 2021 Legislative Session Results.


House Bill 1209 - Highlights

Surplus Lines

  • Removes a notice requirement before exporting policies. Allows an agent to export a flood insurance policy to a surplus insurer without seeking coverage from three or more authorized insurers. (s. 627.715(4) , F.S.)
  • Allows insurance coverage for deductibles to be written on surplus lines without meeting due diligence requirements. (s. 626.916(1)(d), F.S.)
  • The insured must sign a disclosure that substantially provides the
    following: "You are agreeing to place coverage in the surplus lines market. Superior coverage may be available in the admitted market and at a lesser cost. Persons insured by surplus lines carriers are not protected under the Florida Insurance Guaranty Act with respect to any right of recovery for the obligation of an insolvent unlicensed insurer." If the notice is signed by the insured, the insured is presumed to have been informed and to know that other coverage may be available, and, with respect to the diligent-effort requirement under subsection (1), there is no liability on the part of, and no cause of action arises against, the retail agent presenting the form. (s. 626.916(3)b.(3), F.S.)

Bail Bonds

  • The legislation made changes to s. 648.30, F.S., and criminalizes the act of aiding and abetting an unlicensed person:

    (5) Any licensee under this chapter who knowingly aids or abets an unlicensed person in violating this section commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

Effective Date: July 1, 2021 - Laws of Florida, Ch. 2021-113

More detailed analysis for this bill is located in this newsletter under 2021 Legislative Session Results.


Senate Bill 1120

Bail Bonds

The bill amended s. 648.44, F.S. regarding solicitation:(1) A bail bond agent or temporary bail bond agent may not:
(c) Initiate in-person or telephone solicitation after 9:00 p.m. or before
8:00 a.m., in the case of domestic violence cases, at the residence of the detainee or the detainee's family. Any solicitation not prohibited by this chapter must comply with the telephone solicitation requirements in ss. 501.059(2) and (4), 501.613, and 501.616(6).

Effective Date:
July 1, 2021, Laws of Florida, Ch. 2021-185.

More detailed analysis for this bill is located in this newsletter under 2021 Legislative Session Results.


Senate Bill 1598

Telephone Solicitation

New laws related to telephone solicitation went into effect July 1, 2021, and authorize DFS to suspend, revoke, or refuse to issue the license of an insurance agent, adjuster, customer representative, service representative, or managing general agent that makes a consumer's personal financial or medical information available to the public, or initiates in-person or telephone solicitation with a prospective customer after 9 p.m. or before 8 a.m., unless the customer requests otherwise.

Changes to Florida Statutes s. 626.621:

(16) Taking an action that allows the personal financial or medical
information of a consumer or customer to be made available or accessible to the general public, regardless of the format in which the record is stored.

(17) Initiating in-person or telephone solicitation after 9:00 p.m. or before 8:00 a.m. local time of the prospective customer unless requested by the prospective customer.

Effective Date: July 1, 2021, Laws of Florida, Ch. 2021-104

Note: A similar law under Senate Bill 1120 regarding telephone solicitation by bail bond agents was added under SB 1120, s. 648.44(1)(c), F.S (Laws of Florida, Ch. 2021-113)

Senate Bill 1120 - Laws of Florida, Ch. 2021-185, includes laws under Florida Statutes Chapter 501 which may also apply to Department licensees. The Florida Department of Agriculture and Consumers Services holds regulatory authority related to enforcement of those laws.

More detailed analysis for this bill is located in this newsletter under 2021 Legislative Session Results..


General Lines Agents - Adjusting Claims

Hurricane Season began June 1, and we'd like to remind general lines agents they may be able to lawfully adjust claims.

Florida Statutes s. 626.862 states:

"A licensed and appointed insurance agent may, without being licensed as an adjuster, adjust losses for the insurer represented by him or her as agent if so authorized by the insurer. The license and appointment of the agent may be suspended or revoked for violation of or misconduct prohibited by s. 626.611(1)(f)."


reg tap 2021

 

Plan Year 2022 Health Insurance Marketplace Registration and Training for Returning Agents and Brokers

Plan year 2022 Marketplace registration and training for agents and brokers is now available on the Centers for Medicare & Medicaid Services (CMS) Enterprise Portal.

Check out this resource to learn more about the plan year 2022 registration and training process (PDF).


FIFEC Conference Rescheduled for June, 2022

The Florida Insurance Fraud Education Committee (FIFEC) will hold this year's FIFEC Conference scheduled for October 11-13, 2021, has been postponed to June 8-10, 2022.

The conference is a joint venture between the Florida Division of Investigative and Forensic Services and representatives from insurers' special investigative units. The conference offers more than 50 presentations on an array of topics including property and medical insurance, PIP, workers compensation and arson investigations and statutory and case law updates.

Information about the cancellation and registration information can be found at FIFEC's website.

If you have any questions, please email info@fifec.org.


Verify before you sellAgents should always verify the companies they sell for are authorized to do business in Florida. If you suspect an entity is not authorized to transact insurance in Florida, please notify our office. Call 877-MY-FL-CFO (1-877-693-5236).

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Online Sunshine

The Florida Statutes can be viewed online at Online Sunshine

 

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