Chapter 15 selected Florida
non admitted insurer
an insurance company not licensed within given state
agent transfer policy cash value to another policy within the same company, for no apparent benefit to insured this legal practice is known as
churning
OIR Responsibilities cont.
compliance, regulation and enforcement of statues related to the business of insurance and monitoring of industry markets doing business in Florida. licensing insurance companies doing business in Florida or entering the Florida market enforcement of penalties monitor financial solvency; make periodic examinations and on-site inspections approve ( not make) rates; review the forms and rules of companies for compliance with Florida law. focuses on insurance companies. ins companies must have COA, must be licensed to operate in florida and will be audited. carried out by OIR
false statement
conscientious false entry of material facts
Exceptions of certificate of authority
investigations, settlement of claims as a result of former authorized operations in the state transactions covering only subject of insurance not resident/located in this state at time of issuance transactions under surplus lines coverage reinsurance when transacted as authorized continuation of life / health or annunity contracts remaining in force after insurer has withdrawn from florida investment by foreign insurer in Florida real estate transactions involving hospital profession
admitted company
insurance company licensed to do business In a state
what does defamation not include
intentional loss
certificate of authority
is licensed by oir to do business in the state
if an insurance company goes insolvent, what pays unpaid claims or returns unearned premiums
Florida insurance guaranty association
CFO departments
1.Accounting and auditing unclaimed property 2.fiscal integrity - fire marshal, risk management, treasury
state exam for 2-20//20-44 qualifications
18 years old minimum reside in florida complete 200 hr class within 4 years
agents in charge
2-20 2-16 2-14 2-40 2-18 2-15 must be licensed and appointed
Agent license types
2-20 General Lines license 20-44 Personal lines license 4-40 customer representative license
when did Florida state govt merge the department of insurance, treasury and state fire marshal with the department of banking and finance to create a new department of financial services
2002
how long is the agent's appointment good for'
24 months
appointment
24 months, once appointed has 45 days to sponsor agent . if not sponsored then cannot sell insurance and insurer receives fine
appeal right for DFS
30 DAYS
criminal charges and reporting of administrative actions
30 days
expiration of a license or appointment
48 months
what is the requirement for "Law and ethics" continuing education
5 hours
how long does an agent need to keep client records
5 years
how long is a temporary license provided to a family member due to the agents death
6months
rebating Is defined as al of the following except
Agent places additional items on the premium without explaining them to the insured
Unfair Discrimination
Applying different standards to insureds that have the same risks of loss
all are the responsibilities of the department of financial services EXCEPT
Binding insurances coverages
Dos not pass law but administers law
CFO/OIR/DFS
mission is to protect the public
CFO/OIR/DFS
Managing general agent
Cannot appoint customer representative , he or she is an individual that markets products of the various insurance carriers, to the agents inside agency
Office of financial regulation divisions
Division of consumer finance division of financial institution division of securities divisions of financial investigations
Consumer affairs
in charge of responses to customer complaints
MEWA
Group of entities uniting to purchase coverage as a self funded group
What the OFR does
Looks for tips from concerned citizens Public records law= all info related to for investigations is confidential from Florida statues. until the case I no longer active
Twisting is
Making misrepresentation to induce a person to drop their policy to take another company
a insurance company which agrees to indemnify another insurance company from reserves is known as
Reinsurance
Office of insurance regulations (OIR)
Responsible for all activities of companies
Chapter 631
Sates the department serves as receiver for any insurer placed in receivership in florida. the division of rehabilitation and liquidation has the responsibility of performing the duties of the department of financial services in the departments capacity of receivers. oversees the guaranty associations in florida. responsible for all actions in dealing with insolvent or impaired insurers
who oversees the OIR
The insurance commissioner, director of OIR or the commissioner of insurance regulation the CFO, state attorney, commissioner of agriculture and governor of florida, appoints the insurance commissioner , who then heads up the OIR
responses to DFS/OIR
Timely responses, detailed responses
all of the following are functions of the cfo, EXCEPT
To make the insurance Law
agent misrepresented facts about the policy to influence the insured to drop the policy to take new coverage. which term describes this situation
Twisting
Boycott, Coercion, and Intimidation
Using threat or force to create a monopoly or restrict fair trade in the transaction of insurance
who could the agent split the commission with ?
a person with the same type of license
Insurer licensed to conduct business is
admitted
DFS can ____ rules
adopt rules that implement and clarify the Florida statue.
Agency License
after an agent gets a license , he must get a license for the insurance agency he works in. each office must be registered, if not pay 10k fine, must have COA
Adjuster
all lines adjuster, self appointed or appointed by employer. undertakes on behalf of an insurer to ascertain and determine the amount of any claim, loss or damage payable under the insurance company
Transfer of license from another state
be licensed for 1 yr submit a certificate from home state identifying the type of license and agent is in good standing if non resident licensed in Florida, submit application within 90 days after becoming resident submit finger prints for criminal background check satisfy pre-licensing education requirements statisfy exam requirements
what to do when company no longer wants you appointed
call DFS
personal lines agent
can only transact personal auto, homeowners, dwelling flood and personal marine insurance. Can work inside or outside the office quoting, selling and binding insurance to rep same company
consumer protections laws
continuing education requirements for residents and on resident agents fingerprinting requirements as a criminal background check submission of credit and character reports qualification for licensing and examination requirements employees of veteran affairs cannot hold a license as a life or health agent employees of armed forcs cannot sell insurance products to lower ranked personnel( applies to life and health agents) the code of ethics for life insurance agents life agent cannot be a beneficiary of a life policy sold to people other than family Violation of anu other designed consumer protection law by CFO
Bureau of financial investigations
criminal justice agency which conducts investigations . the bureau also participates in joint investigations with local, state and federal law enforcement agencies.
Temporary license
death, disability or military duty occur to 2-20 a family member, employee, personal representative can have license for 6 months
which of the following agencies handles unclaimed property
department of financial services
Agency Enforcement actions
enforces penalties, fines and other punishments upon the violators of the law.
Division of securities
ensures that any financial institution with a state charter meet all state and federal requirements of safety and financial reliability compromised of two bank regulations and a bureau of credit union regulation
Domestic
formed under laws of the state which its doing business
Foreign
formed under the laws of any state, other than the state charted
who may appoint 4-40
general lines agent or general lines insurance agency
Audits (OIR)
has right every 3 yrs to audit companies for protection of consumers make sure the consumers not being defrauded regulate companies
surplus lines carrier specialize in insurance for
hazardous and hard to place risk
Agents records
keep for 3 years after premium payment and 5 yrs after policy expiration
Unaffiliated insurance agent 2015 ; self appointed
licensed insurance agent, except a limited lines agent, self appointed who practices as an independent consultant in the business of analyzing or abstracting insurance policies. may not be affiliated with with an insurer
Continuing education
licensee must complete 5 hr law and ethics update curse 2yrs agents if licensed for less than 6, also have to do 19 hr elective continuing education course per 2 yrs if 6 yrs or more, must doe 15 hr of elective education every 2 yrs
Divisions of consumers finance
licenses and regulates individuals and financial service industries which do not keep deposits. conducts investigations and examinations in response to consumer complaints to make sure the entities comply with the Florida law. License and regulate collection agencies consumer finance companies loan orginators, brokers and lenders money services businesses, such as check cashing companies retail installment sales companies title loan companies
OIR responsibilities
licensing (certificates of authority) rates (approval) policy forms policy approval authority market conditions claims solvency viatical settlements premium financing administrative supervision
Defamation
making false oral or written statements to injury a person or company
Name or address change
must notify DFS within 30 days, 250 1st time and 500 for each time
Application must display
name, license number and insurance agency name
License and appointment
no person can be insurance agent without licensed thru department and appointed by person or entity
Unauthorized Insurer
not authorized by the office
Unlawful Rebates
offering to pat or give something for purchasing policy. enticing a person to buy policy
Customer representative license
office only, represent the same companies which the appointing agent represents
authorized insurer
one duly authorized by an existing certificate of authority to transact insurance in this state
Cease and desist order
order to stop selling insuance by CFO, 50k fine. any unauthorized entity selling products is ground for a third degree felony. 5 yrs and up to 50k
alien
other than domestic/foreign (not charted in us) regardless of where it is does business
Department of financial services
overseas insurance agents and consumer affairs. Supervision of agents, agencies and adjusters The divisions of Consumer services, funeral, cemetery and consumer services public assistance fraud, state fire marshal, risk management, treasury, insurance fraud, rehabilitation and liquidation, insurance agents and agency services workers compensation SUPPORT divisions Administration legal services information systems
OFR Programs
oversees and regulate state charted banks credit unions mortgage loan originators securities industry participates consumer finance companies money transmitters foreign currency exchange companies payday lenders
fraternal
owned by non-profit fraternal organization
mutual
owned by policy holders
stock
owned by stockholders
who cannot appoint a 4-40 license
personal lines agent (20-44)
churning
policies are used to purchase another policy with the same insurer for the purpose o earning additional premiums
captive insurance company
policyholder owns the insurance company, insurer is captive to the policyholder.
Division of consumer services
provided advocacy for consumers who request assistance.
Division of legal services
provides legal advice and counsel to the CFO office. the attorneys represent the office in state and federal court and at informal administrative hearings. they review applications for new companies, work with examiners on regulatory issues and handle the issuance of rules, orders and legal documents produced by the office.
General lines agent
qualified in the areas of property and casualty, marine, surety and health. has authority to solicit insurance or induce customers to purchase insurance; negotiate the premium fees; bind the insurance contract, and finally to transact other matters subsequent to binding of the insurance contract.
when an agent gives something of value or commissions to the insured to encourage them to buy a policy, this known as
rebating
Duties of divisions of customer services
recieved enquiries and complaints from consumers. provides direct assistance and informs consumers enforces penalties based on violations provides direct assistance and advocacy for consumers reports potential violations to appropriate departments for necessary action designates an employee as primary contact for issues relating to sinkholes licensed personnel and companies have 20 days to respond to a written request for information concerning a consumer complaint. failure to comply will impose a 2.5k fine for companies , 250$ (1st violation) 500 (2nd violation) 1k (3rd violation)
divisions of securities
regulates the sales of securities in , to, or from Florida by firms (securities dealers, issuer dealers, issuer dealers and investment advisers) branch offices and individuals affiliated with these firms to determine compliance with Florida law, this is the state version of the securities and exchange commissions. the division is made up of the bureau of registration and the bureau of enforcement
Market conduct examination
regulatory oversight that primarily focuses on regulated entities compliance with laws and regulations other than those related to financial solvency. compliments financial solvency regulation. Evaluates companies fulfillment of contractual obligations to their policyholders and claimants.
who does the agent rep
represents the insurance carrier
Chief financial officer (CFO)
serves as the chief fiscal officer of the state , settle and approve account against the state keep all state and funds
reinsurance
shares reserves with another insurance company
adding ancillary coverages, while advising the insured the coverages are required is illegal and known as
sliding
an individual who has license can
solicaite insurance describe benefits, rates invitation to prospective purchasers making general or specific applications making general or specific recommendations to an insured as to insurance products completing orders or application for insurance products comparing insurance products, advising them as to insurance matters or interpretinf policies or coverages or no licensee shall solicit transact insurance which he is not licensed for
Financial services commission (The commission )
the governor, attorney general, chief financial officer and the commissioner of agriculture. who are responsible for the Office of insurance regulation (OIR) houses legal service of the chief financial officer's office all divisions within the department
DFS other powers
the powers, duties and responsibility expressed in this paragraph do not limit the powers, duties and responsibilities of the department of financial services, the financial services commission, the office of insurance regulation, or the office financial regulation set forth elsewhere in the florida statuses
controlled business
the sale of insurance those whom the agent has an interest in or financial influence. a total of fifty-one percent of the agents business must originate from uncontrolled business.
Office of financial regulations (OFR)
this department is in charge of regulating banks, financial institutions and credit unions. *office is headed by the director of the director of the office of financial regulation, the commissioner of financial regulation *the burea may conduct investigations within or outside the state as the bureau deems necessary *if the office believes any criminal laws has been violated, the officer may refer such violations to state and federal law enforcements *supervision of insurance carries, insurance companies, which also must be licensed, audited and supervisied to ensure they are conforming to market conduct in the business insurance
if an agent is usable to provide service to his/her customers due to death, disability or military duty, all of the following can obtain a temporary license, except
underage minor child