Consumer eViews

Volume 1, Number 14, April 5, 2004

In my job as the state’s Chief Financial Officer, I understand more than ever the importance of teaching financial literacy and accountability to young adults.  

Consider these daunting statistics:

  • One of three teenagers carry credit cards and even more have ATM cards.
  • More young people drop out of college due to credit card debt than bad grades.
  • By graduation, students double their average credit card debt and triple the number of credit cards in their possession.

Along with preparing young people to go out and earn a living, it is equally critical to prepare them to manage what they earn.  We would never just hand our child the keys to a car just because they’ve turned 16.  So it is not realistic to expect a young person to instinctively know how to handle a credit card or manage their money.

April is Financial Literacy for Youth Month.  It is an excellent opportunity to draw attention to the need to teach our young people how to save, manage their money and handle credit.  

The Department of Financial Services is currently embarking on a far-reaching public awareness campaign to help teach financial literacy to Floridians of all ages and economic levels.  A key component of the campaign will be to promote financial education in the classroom, including teaching them the importance of saving money, the wise use of credit, how to balance a checkbook, and how to apply for a loan.  They will also learn about the basics of insurance, including how to purchase insurance, how the claims process works, and how choices can impact the rates they pay.

Our goal is to help equip young people with the tools and information they need to make better decisions about their money and financial future.

Financial education can help steer our children’s economic futures – and I believe the road to financial literacy begins in our schools.

-- Tom Gallagher


A South Florida family lost their homeowners insurance after their mortgage company failed to pay premiums from escrow.  Another Floridian from Tampa was denied insurance coverage on a home he was purchasing because of a past claim for water damage on the property.  These stories and thousands more have prompted Chief Financial Officer Tom Gallagher to join Senator Mike Fasano and Representative David Rivera in pursuing legislation to restore Florida’s marketplace to one that is fair and reasonable for insurance consumers. 

“Thousands of consumers have called us in the last year saying they feel powerless to protect themselves from their insurance companies,” Gallagher said.  “It is fundamentally unfair for consumers to be non-renewed, canceled or to surrender their legal rights with no explanation, or for an insurance company to use incorrect information at the expense of consumers.” 

“Consumers deserve to be in the loop on decisions made by their insurance companies so they know exactly what’s going on with their policy or claim,” Sen. Fasano said. “A Consumers’ Bill of Rights would place the consumer first, ensuring fair and equitable treatment from insurance companies.”

“State leaders have an obligation to ensure consumer protections exist when insurance is mandatory, not voluntary,” Rep. Rivera said. “This legislation ensures strong standards are in place and consumers are treated with honesty and fairness.”

The proposed legislation (SB 2038/HB 557) would provide much-needed protections to consumers insuring homes or automobiles, many of which previously existed in state administrative rule but were repealed in 2002.  The legislation would require insurers to:

  • Reinstate coverage when a policy is canceled for non-payment by the mortgage company.

  • Refrain from canceling coverage for homeowners due to a water damage loss that was rectified.

  • Disclose to applicants who are denied coverage the reason for denial, including information used from CLUE reports.

  • Give consumers a choice in resolving claims disputes.

  • Follow guidelines for handling automobile repairs and claims.

Consumers have told the Department of Financial Services they had difficulty finding replacement coverage after their mortgage company failed to pay premiums.  Some consumers were required to accept more expensive, force-placed coverage obtained from their mortgage companies.  Under this legislation, consumers would not be held responsible for their mortgage companies’ mistakes. 

“In instances where a mortgage company fails to pay insurance premiums, it is unconscionable for an insurance company to then cancel a family’s coverage,” Gallagher said. 

To assist auto insurance consumers, the bill contains a measure to provide auto insurance companies with clear guidelines for handling automobile claims.  The bill would restore a standard of “like, kind and quality” for replacement parts, a requirement which had been in place in department rule for nearly 10 years.   It also establishes standards for dealing with total loss of automobiles to ensure consumers are paid a fair price when their car is totaled in an accident.
The proposed legislation would also prohibit insurance companies from mandating arbitration as the sole claims-dispute resolution process in lieu of a consumer’s statutory right to have the claim mediated.  Arbitration can place a considerable burden on the insured, both in terms of time and money, which may lead some consumers to accept what they consider an unfair settlement of their claim.
“Without options, consumers are locked into a system that stacks the deck when serious disputes arise,” Rep. Rivera said.  “Consumers should be able to purchase insurance coverage with the option to choose mediation or alternative dispute resolution as a method for reconciling claims disputes.”  

Finally, the bill would create a dedicated consumer contact within the Department of Financial Services to deal with emerging sinkhole-related insurance concerns, track trends and provide information to state policymakers.

“A fair and reasonable marketplace is essential for Florida’s consumers,” said Sen. Mike Fasano, who is concerned about availability of insurance coverage for consumers in areas prone to sinkholes.  “This bill recognizes the importance of hearing from consumers experiencing sinkhole-related problems, whether they are buying a home or renewing coverage.”

HB 557 unanimously passed the House Subcommittee on Insurance Regulation.  The Senate version was expected to be heard March 31st in the Senate Banking and Insurance Committee.                                        



In the shadow of Florida’s Old Capitol last week, a crowd of concerned citizens and local leaders hailing from Broward County welcomed Chief Financial Officer Tom Gallagher as part of Broward County Days. Broward Days is an annual effort to promote the area’s local interests in Tallahassee. Gallagher was recognized as a special guest speaker and encouraged those attending by praising Broward County’s vibrant and growing economy.

"With more than 800 people per day making their homes in the Sunshine State, state leaders should continue to support economic development and job growth," Gallagher said. "All Floridians deserve a chance at prosperity and a government supportive of a job-friendly economic climate."

As Florida’s second largest county, Broward County saw an increase in tourism last year, with Ft. Lauderdale International Airport greeting more than 17 million travelers. Entrepreneurs and emerging small business owners can also find a productive home in Broward County. Inc. Magazine, a nationally circulated trade publication, recently named Ft. Lauderdale one of the top 25 cities nationwide for economic development. Gallagher said Broward County also stands to greatly benefit from the planned Scripps Research Institute based in neighboring Palm Beach County.

Scripps, a leading biomedical research facility expanding to Florida, is a key example of efforts to encourage business and research growth. Scripps is projected to create thousands of high-paying jobs and help further diversify Florida’s economy. Over the next 15 years, the project is expected to generate up to $1.6 in additional state revenue to support growing needs in education and social services.

Gallagher said he is committed to building on the state’s economic growth to benefit all Floridians.


A Boca Raton man has lost his license to sell insurance after being charged with compromising the health insurance of four children.

On March 12, the Department of Financial Services filed an administrative complaint against Giovanni Abayan Ouano, age 39, of 2724 NW 26th Street.  The department alleged that Ouano canceled the health insurance plan of an area family’s four children to enroll them into a new plan without the knowledge or consent of the children’s parents. Ouano also changed their family physician without their consent. Ouano’s misconduct was intended to generate commissions for himself.

Ouano elected not to dispute the above allegations, and the department subsequently revoked his insurance license.  Ouano had been licensed as a life, health, and variable annuities agent since May 1998.

The Department of Financial Services investigates allegations of improper conduct by licensed agents and those posing as agents. Questions about agents or insurance policies may be directed to the department’s toll-free helpline at 1-800-342-2762.

Florida Department of Financial Services'
Consumer Services HelpLine