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when transacted as authorized continuation of life / health or annunity contracts remaining in force after insurer has withdrawn from florida investment by foreign insurer in Florida real estate transactions involving hospital profession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