5-Hour Law and Ethics Update - Property and Casualty

5-Hour Law and Ethics Update - Property and Casualty, by Jeff King


Course Information
Course Title: 5-Hour Law and Ethics Update - Property and Casualty
Course Number: OLT # INSCE019               DOI # 92487
Course Description: This class satisfies the new requirement that Agents complete a 5-hour update course every 2 years, which is specific to the license held by the licensee and covers industry law updates, premium discounts, ethics, disciplinary trends, industry trends, and suitability of insurance products.
Location: Completely Online
Available: 24/7
5hr CE Credit: All General Lines licenses
Course Outcomes:

The student will successfully master the material and will achieve a final grade of 70% or better to pass the course. OnLine Training will report the student's completion to the Florida Department of Financial Services. A Certificate of Completion will be issued to the student by email.


Course Outline

Section 1 - Regulatory Awareness

A. Jurisdiction of duties and responsibilities

1. CFO (Chief Financial Officer) – Article IV, Section 4, Florida Constitution - U1-L1-P1

a) Oversees the FLDFS (Florida Department of Financial Services)
b) Created in 1998

2. DFS (Department of Financial Services) – created by 20.121 - U1-L1-P2
F.S. Has 14 divisions broken down into:

a) Service Divisions, including:

i. The Division of Insurance Agents and Agency Services 20.121 (2)(g) F.S.
ii. The Division of Consumer Services 20.121 (2)(h)

b) Support Divisions

i. Administration
ii. Information systems
iii. Legal Services
iv. Public records request

3. Financial Services Commission – created by 20.121(3) F.S. - U1-L1-P3

a) there are 4 members of the commission
b) the 2 offices are the OFR (Office of Financial Regulation) and the OIR (Office of Insurance Regulation)
c) responsible for the approval of rules developed by the OIR and OFR

4.OIR (Office of Insurance Regulation) – created by 20.121(3)(a)1., F.S. - U1-L1-P4

a) responsible for all activities concerning insurers
b) broken down into business units

i. company administration
ii. life and health financial oversight
iii. market research and technology
iv. specialty product administration
v. legal services
vi. life and health product review
vii. property & casualty financial oversight
viii. communications office
ix. government affairs
x. market investigations
xi. property & casualty product review

5. OFR (Office of Financial Regulation) - Created by 20.121(3)(a)2., F.S. - U1-L1-P5

a) responsible for all activities of the Financial Services Commission relating to the regulation of banks, credit unions, other financial institutions, finance companies, and the securities industry.

b) Organization

i. Division of Financial Institutions
ii. Division of Securities
iii. Division of Consumer finance
iv. Bureau of Financial Investments

B. Licensing Requirements – U1-L2-P1

1. Appointment

a) 626.112 F.S. – Agents, Adjusters and CSRs must be licensed and appointed
b) 626.451 F.S. – details the appointment process for the Agent - U1-L2-P2
c) 626.471 F.S. – Appointments may be canceled anytime by the insurer - U1-L2-P3

2. Contact information - U1-L2-P4

a) 626.541 F.S. – gives the Agent 30 days to notify the State if they start doing business under another name, such as a corporation name
b) 626.551, F. S. - A licensee must notify the department, in writing, within 30 days after a change of name, residence address, principal business street address, mailing address, contact telephone numbers, including a business telephone number, or e-mail address.

3. Continuing Education - U1-L2-P5

a) 626.2815 (1) F.S. – establishes requirements for Agents and Adjusters continuing education
b) 626.2815(2) F.S. – explains in detail the types of classes required for each licensee - U1-L2-P6

4. Insurance Agency Licensing - U1-L2-P7

a) 626.112(7)(a) F.S. – As of 10/01/2006, insurance agencies are required to be licensed
b) 626.172 F.S. – describes the insurance agency licensing process
c) 626.382 F.S. – Continuation and expiration of agency licenses. Good for 3 years.

5. Transfer, surrender and termination of licensing - U1-L2-P8

a) 626.292 F.S. – allows the transfer of an insurance license from another state, to Florida, under certain circumstances
b) 626.431 F.S. – gives the Agent 48 months to secure an appointment, or the license will be canceled
c) 626.641 F.S. – allows the State to suspend a license up to 2 years
d) 626.661 F.S. – the license is the property of the State of Florida

6. Grounds for compulsory/discretionary refusal, suspension, or revocation of insurance license/agency license/appointment - U1-L2-P9

a) 626.611 F.S. – outlines the grounds for compulsory suspension, revocation or refusal of an Agent or Adjuster’s license
b) 626.6115 F.S. – outlines the grounds for compulsory suspension, refusal or revocation of an insurance agency license
c) 626.621 F.S. – outlines the discretionary grounds for suspension, refusal or revocation of an Agent or Adjuster’s license
d) 626.6215 F.S. – outlines the discretionary grounds for suspension, refusal or revocation of an insurance agency license - U1-L2-P10
e) 626.631 F.S. – Procedure for revocation, suspension or refusal of a license
f) 626.641 F.S. – Duration of suspension
g) 626.681 F.S. – The State can levy administrative fines
h) 626.691 F.S. – The State may offer probation, in lieu of suspension, refusal or revocation
i) 626.611 F.S. – The State may require the licensee to pay restitution to injured parties, in addition to fees and penalties

7. Duties of licensed vs. unlicensed personnel - U1-L2-P11

a) 626.342 F.S. – not permitted to furnish insurance company supplies to an unlicensed person or an Agent not appointed with that company - U1-L2-P12
b) 626.0428 F.S. – details what insurance agency personnel are permitted to do
c) 626.311 F.S. – describes what types of license is needed to transact specific types of insurance
d) 626.7315 F.S. – General Lines license required to transact certain business
e) 626.753 F.S. – restrictions of sharing of commissions, and the penalties
f) 626.311 F.S .- describes the General Lines license
g) 626.731 F.S -. outlines the qualifications for a General Lines Agent

C. Other Requirements

1. Advertising - U1-L3-P1

a) 626.112(7)(b)4d – Agency personnel may not misrepresent any insurance policy or annuity contract, or use deception with regard to any policy or contract, done either in person or by any form of dissemination of information or advertising. - U1-L3-P2
b) 626.9531 F.S. – advertising must clearly indicate that the communication relates to insurance products
c) 626.9541 – explains in detail false advertising of insurance products

2. Recordkeeping - U1-L3-P3

a) 626.561(2) F.S. – requirement to keep certain records for 3 years
b) 626.748 F.S. – requirement for the Agent to keep records that insureds and the State can have access to for review

D. Department communication - U1-L4-P1

1. My Profile – the department’s interface with Agents and Agencies

2. Website - https://www.myfloridacfo.com/Division/Agents - U1-L4-P2

3. Insurance Insight – Division of Agent and Agency Services monthly newsletter - U1-L4-P3

4. New technology - U1-L4-P4

a) eAppoint
b) fingerprints

E. Guaranty Association – reference Chapter 631, F.S. - U1-L5-P1

1. FIGA (Florida Insurance Guaranty Association)

a) 631.55 F.S. – created FIGA
b) handles the claims of insolvent property & casualty insurance companies

2. FWCIGA (Florida Workers’ Compensation Insurance Guaranty Association) - U1-L5-P2

a) 631.911 F.S. – created the FWCIGA
b) handles the claims of insolvent workers’ comp companies

3. FLHIGA (Florida Life & Health Insurance Guaranty Association) - U1-L5-P3

a) 631.715 F.S. – created the FLHIGA
b) handles the claims of insolvent life, health, accident and some annuity companies

4. FHMOCAP (Florida Health Maintenance Organization Consumer Assistance Plan) - U1-L5-P4

a) 631.815 F.S. – created the FHMOCAP
b) Created by Florida statute to protect persons enrolled for coverage with HMOs, subject to certain limitations, against the failure of their HMO to perform its contractual obligations due to its insolvency.

Section 1 Quiz


Section 2 - Insurance Law and Updates

A. New Florida law updates - U2-L1-P1

1. Required Personal Injury Protection Benefits; exclusions; priority; claims. 627.736 F.S.

a) injured only have 14 days after an accident to seek treatment; (1)(a)
b) Eliminates treatment by acupuncturists and massage therapists; (1)(a)(5)
c) Medical benefits limited to $2500 for non-emergency medical conditions; (1)(a)(4)

2. Citizens – 627.351(6) F.S. - U2-L1-P2

a) Clearinghouse goes into effect January 2014; 627.3518 F.S.
b) New depopulation efforts seek to reduce the number of risks insured; 627.3511 F.S.

3. E-posting/E-bills - U2-L1-P3

a) allows insurers to post certain policies to their websites; 627.421 F.S.
b) allows insurers to send certain commercial insurance policies by email; 627.421 F.S.
c) allows electronic proof of insurance; 316.646 F.S.

B. Pertinent Federal Law Review pertinent to Florida licensed insurance professionals - U2-L2-P1

1. Flood Insurance Reform Act of 2012

a) Eligibility extension for Preferred Risk Policies
b) Removal of rate subsidies for certain risks

2. Medicare Updates - U2-L2-P2

a) More Covered Preventative Services
b) Changes to the Prescription Drug Plan

Section 2 Quiz


Section 3 - Ethical Requirements

A. Code of Ethics - U3-L1-P2

1. DFS Rule 69B-215 F.A.C. – Agents

a) Defines certain illegal acts by Agents
b) Does not endorse any specific designations

2. 626.9641 F.S. – Policyholder’s Bill of Rights - U3-L1-P3

a) Expresses principles to be followed
b) Outlines certain policyholder expectations

B. Marketing regulatory and ethical guidelines for Florida licensed insurance professionals - U3-L2-P1

1. DFS Rule 69B-230 F.A.C. – General ethics and disclosure requirements for insurance representatives

a) requires licensed insurers, managed care entities, agents, brokers, third-party administrators, adjusters, and other licensees of the Department to submit to the Department information of which they become aware concerning unlicensed insurance activity in this State.
b) Describes information that must be reported

2. DFS Rule 69B-240 F.A.C. – Military Sales Practices - U3-L2-P2

a) The purpose of this rule is to set forth standards to protect active duty service members of the United States Armed Forces from dishonest and predatory insurance sales practices by declaring certain identified practices to be false, misleading, deceptive, or unfair.
b) Describes unfair or deceptive acts relating to the sales to military personnel

C. Understanding Industry Products - U3-L3-P1

1. Avoid duplicate coverage or over-insuring

2. Avoid what could cause harm - U3-L3-P2

3. Sell to the need, rather than to the bonus - U3-L3-P3

4. Avoid selling what the consumer cannot afford - U3-L3-P4

D. Unfair Methods of Competition and Unfair or Deceptive Acts – Florida Statutes Chapter 626, Part IX

1. Statutes -626.9541 defines unfair insurance trade practices - U3-L4-P1

2. Churning (aa) - U3-L4-P2

3. Deceptive use of name (bb) - U3-L4-P3

4. Military (cc) - U3-L4-P4

5. Foreign travel (dd) - U3-L4-P5

6. Fraudulent signatures (ee) - U3-L4-P6

7. Designations (ff) - U3-L4-P7

E. Understanding required Premium Discounts

1. History of the Windstorm Mitigation Inspection Program - U3-L5-P1

2. The My Safe Florida Home Program (this program has been discontinued) - U3-L5-P2

3. Selected FL Statutes that deal with Windstorm Mitigation Discounts - U3-L5-P3

a) 553.844 F.S. - Windstorm loss mitigation; requirements for roofs and opening protection.—
b) 627.0629 F.S. - Residential property insurance; rate filings. - U3-L5-P4
c) 627.711 F.S. - Notice of premium discounts for hurricane loss mitigation; uniform mitigation verification inspection form - U3-L5-P5

Section 3 Quiz


Section 4 - Disciplinary and Industry Trends

A. Recent Violations & Enforcement Actions of Florida licensed insurance professionals

1. Health insurance - U4-L1-P1

a) Case notes – from Insurance Insights
b) Enforcement actions – from Insurance Insights

2. Property & Casualty insurance - U4-L1-P2

a) Case notes – from Insurance Insights
b) Enforcement actions – from Insurance Insights - U4-L1-P3

B. Unauthorized Products and Entities involved in Florida commerce

1. FLDFS press release January 15th 2013 - U4-L2-P1

2. Unauthorized entities that have been shut down - U4-L2-P2

3. DFS Unauthorized entities statement - U4-L2-P3

4. Unauthorized entities statutes - U4-L2-P4

a) 626.901 Representing or aiding unauthorized insurer prohibited
b) 626.902 Penalty for representing unauthorized insurer
c) 626.910 Penalty for violation by unauthorized insurers and persons representing or aiding such insurers.

C. New and other Important Terminology applicable to Florida licensed insurance professionals

1. Surplus Lines - U4-L3-P1

2. Biggert-Waters

3 Reinsurance

4. The Terrorism Risk Insurance Act

5. PPACA (Patient Protection and Affordable Care Act)

6. Navigators

Section 4 Quiz


Section 5 - Summary, Unit Reviews and Final Exam


Units 1-2 Review

Units 3-4 Review

Final Exam


Section 6 - Survey and Grade Submittal Form


Grade Submittal Form


Instructor Information
Name: Jeff King
Email: jkingsr@prodigy.net
Office Location: P.O. Box 3303, Palm Beach, FL 33480
Phone: (561) 283-0333 or fax (561) 357-4957

Jeff King is a licensed insurance agent and President of King Insurance & Financial Services, Inc., a full service independent insurance agency in Cape Canaveral, Florida. He has been a licensed Life, Health, and Property & Casualty agent since 1989. Mr. King has taught insurance classes at several community colleges. He is an active member of the National Association of Health Underwriters, the National Association of Insurance and Financial Advisors and the Florida Association of Independent Agents.

Last Updated: June 8, 2015 by Brad Weishaupt